NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

HEET KHARA

EXCHANGE RULES:

Rule 432.I. General Offenses (in part)

It shall be an offense to make a verbal or written material misstatement to the Board, a committee, or Exchange Employees.

Rule 575.A. Disruptive Practices Prohibited

No person shall enter or cause to be entered an order with the intent, at the time of order entry, to cancel the order before execution or to modify the order to avoid execution.

FINDINGS:

Pursuant to an offer of settlement that Heet Khara (“Khara”) presented at a hearing on April 26, 2016, in which Khara neither admitted nor denied the rule violations upon which the penalty is based, a Panel of the COMEX Business Conduct Committee (“Panel”) found it had jurisdiction over Khara pursuant to Exchange Rules 402 and 418 and that on multiple trade dates during the time period of January 2015 and April 2015, Khara engaged in disruptive trading activity, individually, as well as in coordinated fashion with Trader “A”, by entering orders in Gold and Silver futures contracts without the intent to trade. Specifically, Khara layered orders on one side of the market and then cancelled them a few seconds after resting orders on the opposite side of the book were executed. Additionally, Khara made verbal material misstatements to Exchange employees concerning the entries of such orders.

The Panel concluded that Khara violated Exchange Rules 432.I. and 575.A.

PENALTY:

In accordance with the settlement offer, the Panel ordered Khara to (1) pay a fine to the Exchange in the amount of $90,000 and (2) to be permanently banned from (a) applying for Membership at any CME Group exchange; (b) direct or indirect access to any trading or clearing platform owned or controlled by CME Group Inc., including CME Globex; and (c) access to any trading floor owned or operated by any CME Group, Inc. exchange.