NYMEX Fines Trader and Firm for Spoofing and Position Limit Violations

New York Mercantile Exchange ("NYMEX") fined an individual trader and a proprietary trading firm (see here and here) for disruptive practices and position limit violations.

According to the NYMEX Notice of Disciplinary Action, the trader engaged in disruptive trading by entering orders for Crude Oil Futures "without the intent to trade." NYMEX found that the trader canceled larger orders made on one side of the market once smaller orders he had placed on the other side of the market were executed.

In a separate enforcement action, NYMEX stated that, during intraday trading, the proprietary trading firm held a futures long position approximately 39 percent over the standard expiration month limit. NYMEX found that the futures long position went into effect on July 25, 2019 and stayed in effect until July 29, 2019.

To settle the NYMEX charges, the trader and the proprietary trading firm agreed to pay monetary penalties of $45,000 and $20,000, respectively. In addition, the individual agreed to (i) disgorge profits of $500 and (ii) serve a 15-business-day suspension.