SCOTT WALLACH (WAL)
CME RULE VIOLATIONS:
521. REQUIREMENTS FOR OPEN OUTCRY TRADES
In open outcry trading, bidding and offering practices must at all times be conducive to the competitive execution of transactions. All open outcry transactions, including spread and combination transactions, shall be made openly and competitively in the pit designated for the trading of the particular transaction. No bid or offer shall be specified for acceptance by a particular trader. Transactions may take place only at the best price available in the open outcry market at the time the trade occurs.
539. PREARRANGED, PRE-NEGOTIATED AND NONCOMPETITIVE TRADES PROHIBITED
A. No person shall prearrange or pre-negotiate any purchase or sale or noncompetitively execute any transaction.
Pursuant to an offer of settlement in which Scott Wallach (“Wallach”) neither admitted nor denied any rule violations upon which the penalty is based, on February 21, 2012, a panel of the Chicago Mercantile Exchange (“CME”) Business Conduct Committee found that on one or more occasions on May 28, 2010, and between April 4, 2011 and June 3, 2011, while in the S & P 500 Stock Price Index futures pit, Wallach executed buy and sell transactions without bidding or offering both sides of his orders in a manner consistent with open and competitive trades. The panel found that in doing so, Wallach violated CME Rules 521 and 539.A.
In accordance with the offer of settlement, the Panel fined Wallach $15,000 and suspended his membership privileges, access to any trading floor and direct access to any electronic trading or clearing platform owned or operated by CME Group, including CME Globex® for 30 business days. In addition, in accordance with the settlement offer, Wallach is barred from filling customer orders in a floor broker capacity at any CME Group Exchange for a period of three months from the effective date of the Panel’s decision
February 23, 2012
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