NOTICE OF DISCIPLINARY ACTION

MEMBER:

GENEVA TRADING USA, LLC

EXCHANGE RULES: Rule 432. General Offenses (in part)

It shall be an offense:

B.2. to engage in conduct or proceedings inconsistent with just and equitable principles of trade;

Q. to commit an act which is detrimental to the interest or welfare of the Exchange or to engage in any conduct which tends to impair the dignity or good name of the Exchange;

T. to engage in dishonorable or uncommercial conduct.

Rule 433. STRICT LIABILITY FOR THE ACTS OF AGENTS

Pursuant to Section 2(a)(1)(B) of the Commodity Exchange Act, and notwithstanding Rule 432.W., the act, omission, or failure of any official, agent, or other person acting for any party within the scope of his employment or office shall be deemed the act, omission or failure of the party, as well as of the official, agent or other person who committed the act.                                      

FINDINGS:

Pursuant to an offer of settlement in which Geneva Trading USA, LLC (“Geneva”) neither admitted nor denied the rule violations or factual findings upon which the penalty is based, on October 5, 2016, a Panel of the Commodity Exchange (“COMEX”) Business Conduct Committee (“BCC” or “Panel”) found that it had jurisdiction over Geneva pursuant to Exchange Rules 400 and 402, as the conduct occurred while Geneva was a COMEX member firm. The Panel also found that, during the time period from March 2013 through July 2013, a Geneva trader engaged in a pattern of activity in the Gold futures contract market wherein he entered larger-sized orders on one side of the market and then cancelled them several seconds after smaller-sized orders on the opposite side of the book were executed.  The trader’s purpose in entering these larger-sized orders included encouraging market participants to trade with his smaller-sized orders and in many cases his orders had that effect. The Panel concluded that, pursuant to Exchange Rule 433, Geneva is strictly liable for the acts of its employees whose conduct the Panel concluded violated NYMEX Rules 432.B.2., 432.Q., and 432.T. 

PENALTY:

In accordance with the settlement offer, the BCC Panel ordered Geneva to disgorge profits in the amount of $12,683.             

See companion case NYMEX 13-9490-BC-1