The CME issued a disciplinary notice to an energy firm for failing to submit block trades with accurate execution times. There are very specific - and short - times for filing block trade reports regardless of whether they are principal to principal or brokered. In this case, the exchange indicated the failure was "multiple block trades in Crude Oil futures to the Exchange with inaccurate execution times. Additionally, the Panel also found that Syntex failed to properly advise and train its employees as to relevant Exchange rules and Market Regulation Advisory Notices (“MRANs”) in a manner sufficient to ensure compliance with Exchange block trade reporting requirements." The fine was $40K. The notice is here.
So we, have two issues - improper reports and failure to supervise. This can be solved in one of two ways:
First, many firms, including some of the largest global energy firms, have adopted a policy of only executing block trades via a broker. When executed through a broker, the block trade reporting obligation falls to the broker - removing the issue for the company. Please remember that the trader entering the order with the broker must designate it is to be executed via a block trade - either by a global instruction that any trade of block size must be executed as a block or by specific instruction that the individual trade must be executed via a block.
Second, companies do perform training - at least annually - for staff who are authorized to perform block trades on a principal to principal basis. DCM has created and performed training of this type for clients. The major points covered are the requirements for a block trade, the mechanics of a block trade, the timing requirements by product, and the exchange portal for block trade filings. Both ICE and CME have electronic portals for filings and the form is standardized.
There really is no reason to have this type of notice and fine if you follow one of these two paths.