THOMAS MCGURN, JR.
CBOT RULE VIOLATIONS:
Rule 539. Prearranged, Pre-Negotiated and Noncompetitive Trades
A. General Prohibition
No person shall prearrange or pre-negotiate any purchase or sale or noncompetitively execute any transaction . . .
Rule 443. Position Limit Violation
The Market Regulation Department and the BCC shall have the authority to enforce the position limit rules of the Exchange. For purposes of this rule, any positions in excess of those permitted under the rules of the Exchange shall be deemed position limit violations. Additionally, any person making a bid or offer that would, if accepted, cause such person to exceed the applicable position limits shall be in violation of this rule.
Pursuant to an offer of settlement in which Thomas McGurn, Jr. neither admitted nor denied the rule violations upon which the penalty is based, on October 6, 2010, a Panel of the CBOT Business Conduct Committee found that on four trade dates in December 2007, McGurn prearranged the execution of eleven round-turn transaction sets on the e-cbot electronic trading platform in the spot month Soybean Meal and Corn futures contracts. The Panel also found that in executing these transactions, on three occasions McGurn’s intraday spot month speculative position in Corn futures exceeded the spot month speculative position limit by 172 contracts, and on one occasion exceeded the spot month speculative position limit by 22 contracts. In so doing, the Panel found that McGurn violated CBOT Rule 539. and CBOT Rule 443.
In accordance with the settlement offer and inconsideration of McGurn’s cooperation during the course of the investigation, the Panel fined McGurn $7,500 and suspended his membership privileges, access to any CME Group trading floors, and direct access to any CME Group electronic trading or clearing platform for 30 business days, beginning October 7, 2010, and continuing through November 18, 2010, inclusive.
October 8, 2010
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