NOTICE of DISCIPLINARY ACTION

Board of Trade of the City of Chicago, Inc.

NOTICE OF DISCIPLINARY ACTION

FILE NO.:                   23-CH-2311

MEMBER FIRM:         BofA Securities, Inc.           

CBOT Rules:           930.E. Calls for Performance Bond                     

 1. Clearing members must issue calls for performance bond that would bring an account up to the initial performance bond requirement: a) when performance bond equity in an account initially falls below the maintenance performance bond requirement; and b). subsequently, when performance bond equity plus existing performance bond calls in an account is less than the maintenance performance bond requirement.

Such calls must be made within one business day after the occurrence of the event giving rise to the call. Clearing members may call for additional performance bond at their discretion. Notwithstanding the foregoing, a clearing member is not required to call for or collect performance bond for day trades.

 2. Clearing members shall only reduce a call for performance bond through the receipt of performance bond deposits permitted under subsection C. of this rule. Clearing members may cancel a call for performance bond through: a) the receipt of performance bond deposits permitted under subsection C. of this rule only if such deposits equal or exceed the amount of the total performance bond call; or b) inter-day favorable market movements and/or the liquidation of positions only if performance bond equity in the account is equal to or greater than the initial performance bond requirement. Clearing members shall reduce an account holder's oldest outstanding performance bond call first.

3. Clearing members must maintain written records of all performance bond calls issued and satisfied in whole or in part.

930.F. Release of Excess Performance Bond

Subject to exceptions granted by Clearing House staff, clearing members may only release performance bond deposits from an account if such deposits are in excess of initial performance bond requirements.                                                    

FINDINGS:                 Pursuant to an offer of settlement in which BofA Securities, Inc. neither admitted nor denied the rule violations upon which the penalty is based, on June 8, 2023, the Clearing House Risk Committee found that BofA Securities, Inc. violated CBOT Rules 930.E.1., 930.E.2., 930.E.3. and 930.F.

PENALTY:                  In accordance with the settlement offer, the Committee imposed a $150,000 fine.