CHICAGO • Former Deutsche Bank commodities trader David Liew told a Chicago jury he learnt how to manipulate gold and silver prices from the two successful senior traders he admired and worked with for about three years.

Liew said he wanted to be a team player and make money after joining the bank's Singapore office, so he began doing "spoof" trades the way he was taught by Cedric Chanu and James Vorley.

The senior traders often placed buy and sell orders they never intended to execute, a strategy intended to influence prices so they could reap illegal profits, Liew said.

Vorley and Chanu are on trial for fraud and conspiracy, accused of issuing multiple bogus trade orders between 2008 and 2013.

The case is the latest prosecution of "spoofing" trades brought by the United States, which has been cracking down on the practice since the so-called "flash crash" a decade ago.

"I saw Mr Vorley and Mr Chanu do it," Liew, a graduate of the London School of Economics and the prosecution's star witness, said on Wednesday in the US federal court.

Liew, who has pleaded guilty to spoofing charges and is cooperating with the government in return for leniency, said he sat next to Chanu in Singapore from 2009 to 2012 and communicated daily on a live video chat with Vorley in London.

While he knew manipulating prices was wrong, Liew said spoofing trades were "so commonplace" in the market and among his co-workers that he assumed it was okay.

In one of several trades Liew described in detail, he worked with Vorley on Aug 26, 2010, to push up gold prices.

Liew said he put in an order to sell 15 futures contracts, valued at around US$1.8 million (S$2.4 million) based on prices at the time, while Vorley placed an order to buy 80 contracts, which would have been worth about US$9.9 million.

When prices rose, Vorley cancelled his buy order and Liew executed his sell order, he added.

Liew said Vorley and Chanu would often help him with his spam trades.

If they saw he had an open sell order, they would put in a buy order to help him get a better price, exhibits presented at the trial showed.

Such coordinated spoofing could also be done by a lone trader placing orders on each side of the market.

Liew said he became so familiar with spamming that he could tell when his colleagues were doing it.

One day, on noticing that Chanu was making such a trade, Liew sent him a message saying "be careful... don't let the buy orders get into the market", according to a chat log and Liew's testimony.

Vorley and Chanu contend their actions were legal, and that cancelling orders is an accepted bluffing strategy in the competitive world of high-frequency trading, where computers use algorithms to execute massive trades in milliseconds.

None of the traders' actions was flagged by Deutsche Bank's compliance department, defence lawyers said on Tuesday.

Since anti-spoofing laws were passed under the Dodd-Frank financial reforms in 2010, US federal prosecutors have stepped up criminal cases and the US Commodity Futures Trading Commission has initiated more civil complaints.

During cross-examination, defence lawyers sought to discredit the claim that Chanu and Vorley intentionally cancelled trades.

"There's no button that says what intent is," defence lawyer Matthew Mazur said while questioning Liew.

Mr Mazur also noted that Liew must have been aware that his price manipulation was not legal.

In an Aug 8, 2010, chat message to Chanu, Liew wrote: "Cause Dodd-Frank gonna get me fired, Ha Ha," according to a transcript of the conversation shown to jurors.

BLOOMBERG