• NOTICE OF DISCIPLINARY ACTION

      • #
      • CBOT 17-0661-BC
      • Effective Date
      • 08 June 2017
    • MEMBER:

      MERRILL LYNCH COMMODITIES INC.

      CBOT RULE VIOLATION:

      562. POSITION LIMIT VIOLATIONS

      Any positions in excess of those permitted under the rules of the Exchange shall be deemed position limit violations.

      FINDINGS:

      Pursuant to an offer of settlement Merrill Lynch Commodities Inc. (“Merrill Lynch”) presented at a hearing on June 6, 2017, in which Merrill Lynch neither admitted nor denied the rule violation upon which the penalty is based, a Panel of the Chicago Board of Trade Business Conduct Committee (“Panel”) found that on February 28, 2017, Merrill Lynch held a futures position of 660 short March 2017 (“MAR17”) Soybean contracts which was 60 contracts (10%) over the spot month limit. The MAR17 Soybeans position limit went into effect at the close of business on February 27, 2017 and was effective through the expiration of the contract on March 14, 2017. Merrill Lynch realized a profit of $124.20 from the liquidation of its excess position. This was Merrill Lynch’s third position limit violation in five months.

      The Panel found that as a result, Merrill Lynch violated Rule 562.

      PENALTY:

      In accordance with the settlement offer, the Panel ordered Merrill Lynch to pay a fine to the Exchange in the amount of $35,000 and disgorge profits in the amount of $124.20.

      EFFECTIVE DATE:

      June 8, 2017