8 disciplinary notices in 4 related cases - all permanent expulsions from the market, most for executed trades

The CME issued 8 disciplinary notices in 4 separate main dockets today. All of the dockets permanently barred the named individuals from participation in CME markets. In two cases, the dockets covered both COMEX and NYMEX violations in the same main docket number and the fines were split between the exchanges, one total fine for $50K and another for $60K. 

The most interesting docket was docket COMEX-16-0425-BC-1, BC-2, and BC-3. In this case three individuals were cited for multiple executed trades that disrupted the markets. In particular (the language is the same in all three separate dockets with just a reordering of the names):

"a Panel of the Commodity Exchange (“COMEX”) Probable Cause Committee charged Jiang Dawei (“Jiang”) with violating Exchange Rule 575.D. based on the allegations that from August 2015 through January 2016, Jiang, while trading in several COMEX precious metal markets, coordinated with Xu Jianfeng (“Xu”) and Liu Sau Fung (“Fung”), to frequently enter orders on one side of the market, each for one hundred or contracts or more, within the same rolling minute, which, after having been filled, had significant effects on the price and volume in the respective markets. Jiang, Xu and Fung would then repeat the process on the opposite side of the market which lead to further and often, more severe effects on prices and volume."

Note that this is not for entering orders with a failure of intent to execute (though some of the other dockets issued today were for that) but rather for entering and executing orders in a way that caused severe price and volume shifts. 

One other docket - NYMEX-16-0423-BC - was based on coordinated orders through 13 separate Tag50 accounts controlled by a single individual that caused severed price and volume fluctuations. Note that, again, this is not a spoofing issue but rather trading that caused market movements that were considered aberrant.

This should cause compliance officers to think about looking at not just cancel and amend orders for spoofing but also looking at intra-day trading activity for abnormal volume and price movements. Not always a point of focus if the position stays relatively flat.