NYMEX and COMEX Charge Firms with Block Trade and Wash Trade Violations

The Business Conduct Committees of the New York Mercantile Exchange and the Commodity Exchange sanctioned two firms and two traders for numerous exchange rule violations related to block trades and wash trades.

In separate disciplinary actions:

• NYMEX fined a firm $65,000 for (i) submitting multiple block trades with inaccurate execution times, (ii) failing to report block trades within the required time period following execution, (iii) disclosing counterparties' information without the counterparties’ permission, and (iv) failing to properly train employees as to relevant Exchange Rules and Market Regulation Advisory Notices.
• NYMEX fined a firm $40,000 in connection with (i) a firm employee executing numerous wash trades between accounts with a common beneficial owner, and (ii) failing to properly supervise its employee’s trading activities and not providing sufficient compliance training.
• NYMEX fined a trader $20,000 and imposed a 10-business day suspension for executing wash trades between accounts with common beneficial ownership.
• COMEX fined a trader $20,000 and imposed a 5-business day suspension for (i) pre-arranging the execution of round turn transactions in various futures markets between an account he controlled and an account he owned, and (ii) using another person’s operator ID to enter those orders on Globex.