EXCHANGE RULE: 538.H. Documentation
Parties to any EFRP transaction must maintain all documents relevant to the Exchange contract and the cash, OTC swap, OTC option, or other OTC derivatives, including all documents customarily generated in accordance with relevant market practices and any documents reflecting payment and transfer of title. Any such documents must be provided to the Exchange upon request, and it shall be the responsibility of the carrying clearing member firm to provide such requested documentation on a timely basis.
Pursuant to an offer of settlement SMANN SA (“SMANN”) presented at a hearing on July 24, 2014, in which SMANN neither admitted nor denied the rule violation upon which the penalty is based, a Panel of the NYMEX Business Conduct Committee (“Panel”) found it has jurisdiction over SMANN pursuant to NYMEX Rules 400 and 418 and that on September 10, 2013 SMANN entered into an EFRP transaction which did not contain documentation of the related swap transaction and, therefore, was not a bona fide EFRP transaction.
The Panel found that as a result, SMANN violated Rule 538.H.
In accordance with the settlement offer, the Panel ordered SMANN to pay a fine to the Exchange in the amount of $7,500.
July 28, 2014
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