LEGACY CBOT RULE VIOLATION:
534. WASH SALES PROHIBITED
No person shall place for the same beneficial owner buy and sell orders for the same product and expiration month, and, for a put or call option, the same strike price, at or about the same time with the intent to avoid a bona fide market position exposed to market risk (transactions commonly known or referred to as wash sales). Buy and sell orders placed for the same beneficial owner in the same product and expiration month, and, for a put or call option, the same strike price, must be entered in good faith for the purpose of executing bona fide transactions that result in a change of ownership. Additionally, no person shall accept, execute or accommodate the execution of orders which are prohibited by this rule with knowledge of their character.
Pursuant to an offer of settlement in which COFCO neither admitted nor denied the rule violations upon which the penalty is based, on November 10, 2011, a panel of the Chicago Board of Trade Business Conduct Committee found that on December 10, 2007, five trades were executed on behalf of COFCO on the Globex electronic trading platform with accounts ultimately owned by COFCO as both buyer and seller in the transactions. The Panel found that in so doing, COFCO violated Legacy CBOT Rule 534.
In accordance with the settlement offer, the Panel fined COFCO $9,000.
November 14, 2011
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