NYMEX RULE VIOLATIONS:
RULE 432. GENERAL OFFENSES
It shall be an offense:
B.2. to engage in conduct or proceedings inconsistent with just and equitable principles of trade;
X. to aid or abet the commission of any offense against the Exchange;
Pursuant to an offer of settlement in which Blake Strohofer (“Strohofer”) neither admitted or denied the rule violations upon which the penalty is based, on April 29, 2014, a Panel of the NYMEX Business Conduct Committee (“BCC”) found that Strohofer voluntarily submitted himself to the jurisdiction of the Exchange for purposes of settling this matter and that, in three instances on trade dates June 28, 2010 and July 28, 2010, Strohofer entered orders for Natural Gas futures contracts intended for his customer (“Strohofer’s customer”) and allocated them to an account owned by a former Associated Person. These Natural Gas orders, which ranged from 124 to 196 lots, were offset by matching the former Associated Person’s account opposite Strohofer’s customer’s account via block trades. The executed block trades resulted in Strohofer’s customer receiving non-competitive prices and being disadvantaged, while the former Associated Person realized a profit.
The Panel found that Strohofer thereby violated NYMEX Rules 432.B.2. (General Offenses – Inconsistent With Just and Equitable Principles of Trade) and 432.X. (General Offenses - Aid or Abet the Commission of Any Offense Against the Exchange).
In accordance with the settlement offer and taking into consideration Strohofer’s financial condition when levying the sanction, the Panel ordered Strohofer to serve a 10 year suspension from membership privileges on any CME Group Inc. exchange, access to all CME Group Inc. trading floors and direct or indirect access to all electronic trading and clearing platforms owned or operated by CME Group Inc., including Globex. The suspension will run from May 1, 2014 through May 1, 2024.
May 1, 2014
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