Newedge USA, LLC
CBOT RULE VIOLATION:
Rule 811 (“Position Change Data”)
Position change data must be submitted to the Clearing House each trading day not later than the time specified by the Clearing House. Position change data will be in such form and contain such information as prescribed by the Clearing House. When requested, the identification of accounts will be made available to the Financial and Regulatory Surveillance Department.
Pursuant to an offer of settlement in which Newedge USA, LLC (“Newedge”) neither admitted nor denied the rule violations upon which the penalty is based, on August 19, 2014, a Panel of the Chicago Board of Trade (“CBOT”) Business Conduct Committee (“Panel”) found that it had jurisdiction over Newedge pursuant to Rules 400 and 402 as the conduct occurred while Newedge was a CBOT member, and that on March 16, 2012, Newedge misreported open interest in 15 markets by 0.03% to 4.50%. The omission of a house or customer origin identifier resulted in reported customer origin positions being overwritten by house origin positions. While Newedge identified the reporting errors prior to the 8:00 AM adjustment deadline of March 19, 2012, Newedge was ultimately unable to complete all adjustments prior to the deadline due to the large number that were necessary to correct the inaccurately-reported open interest. The Panel concluded that Newedge thereby violated CBOT Rule 811.
In accordance with the settlement offer, the Panel ordered Newedge to pay a fine of $2,000.
August 21, 2014
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