NOTICE OF DISCIPLINARY ACTION

MEMBER:

Ronald Sippel

CME RULE VIOLATION:

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 trades or 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 in which Ronald Sippel (“Sippel”) neither admitted nor denied the rule violation upon which the penalty is based, on September 7, 2016, a Panel of the Chicago Mercantile Exchange Business Conduct Committee (“BCC” or “Panel”) found that Sippel was subject to the BCC’s jurisdiction pursuant to Rules 400 and 402 as the conduct occurred while Sippel was a CME member. The Panel further found that on multiple dates between January 13, 2014, and October 21, 2014, Sippel executed numerous Eurodollar Futures double butterfly strategies for accounts over which he maintained control where there was common beneficial ownership on both sides of the transactions. Sippel placed the opposing buy and sell orders with the knowledge and intent that the orders would trade opposite one another. The purpose of these transactions was to transfer positions from one account to another. The Panel concluded that Sippel thereby violated CME Rule 534.

PENALTY:

In accordance with the settlement offer, the Panel ordered Sippel to pay a fine of $55,000, and to have his access to all CME Group trading floors and direct and indirect access and to all electronic trading and clearing platforms owned or controlled by CME Group suspended for 10 business days, beginning on the effective date below and continuing through and including September 22, 2016.

EFFECTIVE DATE:

September 9, 2016