SHI BING CHENG
RULE 575.A. DISRUPTIVE PRACTICES PROHIBITED
All orders must be entered for the purpose of executing bona fide transactions. Additionally, all non-actionable messages must be entered in good faith for legitimate purposes.
A. 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.
RULE 432.L. GENERAL OFFENSES (IN PART)
It shall be an offense:
L.1. to fail to appear before the Board, Exchange staff or any investigative or hearing committee at a duly convened hearing, scheduled staff interview or in connection with any investigation.
On June 5, 2018, a Panel of the New York Mercantile Exchange (“NYMEX”) Probable Cause Committee charged Shi Bing Cheng (“Cheng”) with violating NYMEX Rules 575.A. and 432.L.1., based on allegations that on one or more occasions from November 22, 2016 to November 23, 2016, Cheng entered orders in Crude Oil futures with the intent, at the time of order entry, to cancel the orders before execution to avoid execution and also failed to appear before Exchange stuff for a scheduled staff interview.
On August 14, 2018, a Hearing Panel Chair of the NYMEX Business Conduct Committee (“BCC”) entered an order finding that Cheng failed to answer the charges against him. The Hearing Panel Chair further ordered that Cheng was deemed to have admitted the charges issued and waived his right to a hearing on the merits of the charges.
On October 10, 2018, a penalty hearing was held before a panel of the NYMEX BCC (“BCC Panel”) which found that Cheng had committed the violations charged.
In accordance with NYMEX Rule 402.B (Sanctions), the BCC Panel ordered Cheng to (1) pay a $75,000 fine to the Exchange in connection with this case and companion case COMEX 17-0630-BC ($25,000 of which is allocated to NYMEX); and (2) 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 the CME Group, Inc.; and (c) access to any trading floor owned or operated by any CME Group, Inc. exchange, including CME Globex.