HSBC Securities (USA) Inc.
CBOT RULE VIOLATIONS:
Rule 526 Block Trades (in part)
F. The seller must ensure that each block trade is reported to the Exchange within five minutes of the time of execution; except that block trades in interest rate futures and options executed outside of Regular Trading Hours (7:00 a.m. – 4:00 p.m. Central Time, Monday – Friday on regular business days) must be reported within fifteen minutes of the time of execution.
Pursuant to an offer of settlement in which HSBC Securities (USA) Inc. (“HSBC”), neither admitted nor denied the Rule violations upon which the penalty is based, on March 25, 2014, a Panel of the Chicago Board of Trade Business Conduct Committee (“Panel”) found that on June 3, 2011, HSBC executed a block trade in the September 2011 Five-Year US Treasury Note futures contracts, and failed to report the trade to the Exchange within five minutes. The Panel concluded that HSBC thereby violated CBOT Rule 526.F.
In accordance with the settlement offer, the Panel fined HSBC $25,000.
March 27, 2014
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