STUART LEBOWITZ (LEBO)
EXCHANGE RULES: 432. GENERAL OFFENSES
It shall be an offense:
I. to make a verbal or written material misstatement to the Board, a committee, or Exchange employees;
Q. to commit an act which is detrimental to the interest or welfare of the Exchange or to engage in any conduct which tends to impair the dignity or good name of the Exchange;
501. EMPLOYEES OF MEMBERS
Members shall register with the Exchange all persons whom they wish to employ on the trading floor. Such employees may act as runners, communicators and clerks. Such employees shall not be permitted to solicit customers or benefit from the production of orders. Such employees shall not trade or have any interest in an account trading in any NYMEX or COMEX futures or options contracts. Employees must wear a prescribed identification badge. Any member permitting trading by such employee shall be guilty of an offense against the Exchange. Remuneration to such employees shall be limited to salaries and normal bonuses. The member employer shall, upon request, provide a report to Exchange staff with respect to each such employee, setting forth the hours of employment, salary and bonus, and a copy of each employee's Internal Revenue Service W-2 Form or other documentation evidencing employment.
After conducting a settlement hearing on October 25, 2010, a panel of the COMEX Business Conduct Committee (“BCC Panel”) found, based on Mr. Lebowitz’s Offer of Settlement made without admitting or denying the rule violations upon which a penalty is based, that Mr. Lebowitz (i) made verbal misstatements to CME Group Market Regulation Department staff during an on-the-record interview; and (ii) improperly facilitated the registration of an employee clerk for a period of time of many years, thereby giving said clerk access to the NYMEX building and the Exchange trading floor, where the clerk operated a “freelance clerking” business on the Exchange Floor, and the improperly registered clerk did not provide clerical services to Mr. Lebowitz, and the improperly registered clerk was not supervised by Mr. Lebowitz or any other Member.
The BCC Panel found that in so doing Mr. Lebowitz violated Exchange Rules 432.I (“General Offenses”), 432.Q (“General Offenses”), and 501 (“Employees of Members”).
In accordance with the settlement offer and its findings, the BCC Panel ordered that Mr. Lebowitz: (1) pay a fine to the Exchange in the amount of $20,000; (2) accept a six (6) month bar from reapplication for membership privileges or application for clerk privileges, including but not limited to, access to any CME Group trading floor and direct access to any CME Group electronic trading or clearing platforms from the effective date of the NFA 9.11 Notice or from October 27, 2010, whichever is later; and (3) Cease and Desist from subsequent similar rule violations. This decision became final on October 25, 2010 and effective on October 27, 2010.
October 27, 2010