Rule 432. General Offenses (in part)
It shall be an offense:
B.2. to engage in conduct or proceedings inconsistent with just and equitable principles of trade;
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;
T. to engage in dishonorable or uncommercial conduct.
Pursuant to an offer of settlement Simon Posen (“Posen”) presented at a hearing on June 16, 2015, in which Posen neither admitted nor denied the findings or rule violations upon which the penalty is based, a Panel of the COMEX Business Conduct Committee (“BCC”) found that Posen was a COMEX member and therefore subject to the jurisdiction of the Exchange pursuant to Rules 400 and 402, and that on multiple trade dates during the time period from September 2013 through February 2014, Posen entered numerous orders in the Gold futures contract without the intent to trade but rather to observe the market’s reaction and to encourage market participants to trade opposite his smaller orders that were resting on the opposite side of the book. After receiving a fill on his smaller orders, Posen would cancel the resting orders he had entered on the opposite side of the order book, within one second.
The Panel found that as a result of the above, Posen violated Exchange Rules 432.B.2., 432.Q, and 432.T.
In accordance with the settlement offer, the Panel: 1) ordered Posen to pay a $75,000 fine in connection with this case and companion case NYMEX 13-9258-BC ($45,000 of which is allocated to COMEX); and 2) ordered Posen to serve a five (5) five week suspension of any access to any CME Group Inc. trading floor and of direct and indirect access to all electronic trading and clearing platforms owned or controlled by CME Group Inc., including CME Globex. The suspension shall run from June 18, 2015 through July 23, 2015, inclusive.
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