• NOTICE OF DISCIPLINARY ACTION

      • #
      • 13-CH-1304
      • Effective Date
      • 18 February 2014
    • CHICAGO BOARD OF TRADE

      NOTICE OF DISCIPLINARY ACTION

      FILE NO.: 13-CH-1304

      MEMBER FIRM: BNP Paribas Securities Corp.

      CBOT RULES:

      971. SEGREGATION, SECURED AND CLEARED SWAPS CUSTOMER ACCOUNT REQUIREMENTS

      A. All clearing members must comply with the requirements set forth in CFTC Regulations 1.20 through 1.30, 1.32, 1.49 and 30.7, and Part 22 of the CFTC Regulations. This includes, but is not limited to, the following:

      2. Computing, recording and reporting completely and accurately the balances in the:

      a. Statement of Segregation Requirements and Funds in Segregation;

      b. Statement of Secured Amounts and Funds Held in Separate Accounts; and

      c. Statement of Segregation Requirements and Cleared Swaps Customer Collateral Held in Cleared Swaps Customer Accounts; and

      3. Obtaining satisfactory segregation, secured 30.7 and Cleared Swaps Customer account acknowledgment letters and identifying segregated, secured 30.7 and Cleared Swaps Customer accounts as such.

      C. In addition to complying with all applicable CFTC regulations, in order for each of an FCM clearing member’s customer segregated, secured 30.7 and Cleared Swaps Customer accounts held at a bank or trust company to be included as segregated and secured 30.7 funds and Cleared Swaps Customer Collateral in their respective origin and calculation:

      1. The FCM clearing member must provide the Audit Department with view-only full access via the internet to the account information, in a form and manner prescribed by the Audit Department; and

      2. The bank or trust company must allow the FCM clearing member to provide the Audit Department with view-only full access via the internet to the account information, in a form and manner prescribed by the Audit Department.                                               

      FINDINGS: Pursuant to an offer of settlement in which BNP Paribas Securities Corp. neither admitted nor denied the rule violations upon which the penalty is based, on February 14, 2014, the Clearing House Risk Committee found that BNP Paribas Securities Corp. violated CBOT Rules 971.A.2., 971.A.3., and 971.C.

      PENALTY: In accordance with the settlement offer, the Committee fined BNP Paribas Securities Corp.  $50,000.

      EFFECTIVE DATE: February 18, 2014