• NOTICE OF DISCIPLINARY ACTION

      • #
      • NYMEX 13-9498-BC
      • Effective Date
      • 15 August 2014
    • FILE NO.:

      NYMEX 13-9498-BC

      NON-MEMBER:

      SUNCOR ENERGY MARKETING INC.

      EXCHANGE RULES:

      NYMEX RULE 432: GENERAL OFFENSES (in part)

      It shall be an offense:

      W. for a Member to fail to diligently supervise its employees and agents in the conduct of their business relating to the Exchange;

      NYMEX RULE 534: WASH TRADES PROHIBITED

      No person shall place or accept buy and sell orders in the same product and expiration month, and, for a put or call option, the same strike price, where the person knows or reasonably should know that the purpose of the orders is to avoid taking a bona fide market position exposed to market risk (transactions commonly known or referred to as wash sales). Buy and sell orders for different accounts with common beneficial ownership that are entered with the intent to negate market risk or price competition shall also be deemed to violate the prohibition on wash trades. Additionally, no person shall knowingly execute or accommodate the execution of such orders by direct or indirect means.

      FINDINGS:

      Pursuant to an offer of settlement Suncor Energy Marketing Inc. (“Suncor”) presented at a hearing on August 13, 2014, in which Suncor neither admitted nor denied the rule violations upon which the penalty is based, a Panel of the NYMEX Business Conduct Committee (“BCC Panel”) found that it had jurisdiction over Suncor pursuant to Rules 402 and 418, and that for the time period August 2012 to November 2012, traders employed by Suncor executed trades in the Crude Oil Futures contract between three accounts with the same beneficial owner in order to offset positions in the expiring contract. The Panel also found that Suncor failed to diligently supervise its traders in a manner sufficient to ensure that they were familiar with Exchange rules such as through appropriate compliance training.

      The BCC Panel found that as a result, Suncor violated NYMEX Rules 432.W and 534.

      PENALTY:

      In accordance with the settlement offer, the BCC Panel ordered Suncor to pay a fine to the Exchange in the amount of $40,000.

      EFFECTIVE DATE:

      August 15, 2014