• NOTICE OF DISCIPLINARY ACTION

      • #
      • 14-CH-1402
      • Effective Date
      • 20 June 2014
    • CHICAGO BOARD OF TRADE

      NOTICE OF DISCIPLINARY ACTION

      FILE NO.: 14-CH-1402

      MEMBER FIRM: Merrill Lynch, Pierce, Fenner & Smith Incorporated 

      CBOT RULE: 971. SEGREGATION, SECURED AND CLEARED SWAPS CUSTOMER ACCOUNT REQUIREMENTS

      E. All disbursements not made for the benefit of a customer from a segregated, secured 30.7 or Cleared Swaps Customer account which exceed 25% of the FCM clearing members excess segregated, secured 30.7 or Cleared Swaps Customer of the respective origin must be pre-approved in writing by the clearing member’s Chief Executive Officer, Chief Financial Officer or their authorized representative with knowledge of the firm’s financial requirements and position.

      FINDINGS: Pursuant to an offer of settlement in which Merrill Lynch, Pierce, Fenner & Smith Incorporated neither admitted nor denied the rule violation upon which the penalty is based, on June 19, 2014, the Clearing House Risk Committee found that Merrill Lynch, Pierce, Fenner & Smith Incorporated violated CBOT Rule 971.E.

      PENALTY: In accordance with the settlement offer, the Committee fined Merrill Lynch, Pierce, Fenner & Smith Incorporated $25,000.

      EFFECTIVE DATE: June 20, 2014