• NOTICE OF DISCIPLINARY ACTION

      • #
      • NYMEX 16-0597-BC
      • Effective Date
      • 16 June 2017
    • MEMBER:

      MERRILL LYNCH COMMODITIES INC.

      NYMEX 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 14, 2017, in which Merrill Lynch neither admitted nor denied the rule violation upon which the penalty is based, a Panel of the New York Mercantile Exchange Business Conduct Committee (“Panel”) found that on December 19, 2016, Merrill Lynch reached an open January 2017 Crude Oil Futures contract (“JAN17 Crude Oil”) futures position of 4,562 long contracts, which was 1,562 contracts, or 52.06%, over the standard 3,000 contract position limit in JAN17 Crude Oil that went into effect at the close of business on December 15, 2016 and was in effect for trade dates December 16, 19, and 20, 2016. The Panel found that Merrill Lynch realized a profit of $11,560.20 by reducing the firm’s excess JAN17 Crude Oil positions.

      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 $25,000 and disgorge profits in the amount of $11,560.20.