KENT RALPH EMERSON WHITNEY
APPLICABLE CBOT RULE:
402.C. BUSINESS CONDUCT COMMITTEE – EMERGENCY ACTIONS
1. The BCC is authorized to determine whether an emergency exists and whether emergency action is warranted. The following events and/or conditions may constitute emergencies:
e. Any circumstance in which it appears that a Member or any other person or entity has failed to perform contracts or is in such financial or operational condition or is conducting business in such a manner that such person or entity cannot be permitted to continue in business without jeopardizing the safety of customer funds, Members, or the Exchange;
BASIS OF ACTION:
On November 22, 2010, a Panel of the CBOT Business Conduct Committee took an Emergency Action against member Kent R.E. Whitney. This action is based on a good faith determination that Whitney, during the effective dates of a prior Emergency Action, which prohibited him from soliciting business on any exchange owned or controlled by CME Group and precluded him from affiliating with or doing business with any Member, solicited persons to invest with him money to be used in trading futures and/or options at CME Group exchanges. Whitney also solicited persons to invest in Crescent Holding Group, LLC, a company operated by Whitney and David Parrish that had a business purpose of trading products at CME Group exchanges.
In soliciting investors and promising high rates of return, between July and October 2010, Whitney and Parrish received at least $50,000 to be used in trading products at CME Group exchanges. It further appears that the funds Whitney solicited were never invested as Whitney promised, and the funds have since dissipated.
In the good faith exercise of its sole discretion, the Panel has good cause to believe that Whitney is, has been or will be conducting business in a manner that cannot be permitted to continue without jeopardizing the safety of customer funds, Members or the Exchange. Moreover, the Panel has good cause to believe Whitney has failed to perform contracts or is in such financial or operational condition that he cannot be permitted to continue in business without jeopardizing the safety of customer funds, Members, or the Exchange.
Pursuant to Rule 402.C., Whitney is hereby barred from directly or indirectly accessing all CME Group markets, including the CME Globex platform, all trading floors owned or controlled by CME Group, including CBOT, CME, NYMEX and COMEX, and all clearing platforms owned or controlled by CME Group.
This action prohibits Whitney from trading, placing orders (on his own or someone else’s behalf), or soliciting business on any exchange owned or controlled by CME Group. Whitney is also precluded from affiliating or doing business with any member or member firm of CBOT, CME, NYMEX or COMEX.
This action is effective for a period of six months, beginning immediately and continuing through and including May 24, 2011.
November 23, 2010
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