ICAP CORPORATES, LLC
EXCHANGE RULES: EXCHANGE RULE 526. BLOCK TRADES
The Exchange shall designate the products in which block trades shall be permitted and determine the minimum quantity thresholds for such transactions. The following shall govern block trades:
F. The seller must ensure that each block trade is reported to the Exchange within five minutes of the time of execution. The report must include the contract, contract month, price, quantity of the transaction, the respective clearing members, the time of execution, and, for options, strike price, put or call and expiration month. The Exchange shall promptly publish such information separately from the reports of transactions in the regular market.
LEGACY EXCHANGE RULE 538 EXCHANGE FOR RELATED POSITIONS
G. Identification and Submission to the Clearing House
Each EFRP transaction shall be designated as such and shall be cleared through the Clearing House. Each such transaction shall be submitted to the Clearing House within the time period and in the manner specified by the Exchange. Clearing member firms are responsible for exercising due diligence as to the bona fide nature of EFRP transactions submitted on behalf of customers.
Pursuant to an offer of settlement that ICAP Corporates, LLC (“ICAP”), presented at a hearing on May 28, 2015, in which ICAP neither admitted nor denied the factual allegations or rule violations upon which the penalty is based, a Panel of the NYMEX Business Conduct Committee (“Panel”) found that ICAP consented to the jurisdiction of the Exchange for purposes of resolving this matter for the time period of January 2012 through August 19, 2012, and was subject to the jurisdiction of the Exchange for the time period of August 20, 2012 through June 2013 pursuant to Exchange Rules 402 and 418. The Panel found that during the time period of January 2012 through June 2013, ICAP executed multiple block trades for customers that were not reported to the Exchange within the applicable time limit following execution, incorrectly reported the true and accurate time of execution of block trades to the Exchange, and also incorrectly reported Exchange for Swap (“EFS”) transactions as block trades to the Exchange.
The Panel concluded that ICAP violated Exchange Rule 526.F. (“Block Trades”) and Legacy Exchange Rule 538.G (“Exchange for Related Positions”).
In accordance with the settlement offer, the Panel ordered ICAP to pay a fine to the Exchange in the amount of $40,000.
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