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.
Pursuant to an offer of settlement that Eric Mlak (“Mlak”), owner and president of Fort Pitt Energy, LLC (“Fort Pitt”), presented at a hearing on November 23, 2015, in which Mlak 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 it had jurisdiction over Mlak pursuant to Exchange Rules 402 and 418, and during the time period of January 2013 through March 2013, Mlak, on behalf of Fort Pitt, executed multiple block trades for customers that were not reported to the Exchange within the applicable time limit following execution.
The Panel concluded that Mlak violated Exchange Rules 526.F. (“Block Trades”).
In accordance with the settlement offer and taking his financial condition and that of Fort Pitt into consideration, the Panel ordered Mlak to serve a three month 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 will run from November 25, 2015 through February 17, 2016 inclusive.
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