• NOTICE OF DISCIPLINARY ACTION

      • #
      • CME 18-0942-BC
      • Effective Date
      • 11 April 2019
    • FILE NO.:

      CME 18-0942-BC

      NON-MEMBER:

      Denis Pospelov

      CME RULE VIOLATIONS:

      Rule 575. (Disruptive Practices Prohibited) (in part)

      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 an intent, at the time of order entry, to cancel the order before execution or to modify the order to avoid execution.

      Rule 576. (Identification of Globex Terminal Operators) (in part)

      Each individual must use a unique user ID to access Globex. In no event may a person enter an order or permit the entry of an order by an individual using a user ID other than the individual’s own unique user ID.

      FINDINGS:

      Pursuant to an offer of settlement in which Denis Pospelov (“Pospelov”) neither admitted nor denied the rule violations upon which the penalty is based, on April 9, 2019, a Panel of the Chicago Mercantile Exchange Business Conduct Committee (“Panel”) found that from December 1, 2017, through April 30, 2018, Pospelov entered orders in the December 2017 E-mini S&P 500, March 2018 E-mini S&P 500, and June 2018 E-mini S&P 500 futures and options on futures markets without the intent to trade. Specifically, Pospelov entered the orders opposite smaller orders that were resting in the E-mini S&P 500 futures markets or the E-mini S&P 500 Weekly options markets, and then canceled the larger orders immediately after receiving a fill on a smaller order. Finally, during this timeframe, Pospelov permitted others to use his own, and used others’, unique Tag 50 user IDs to execute trades.

      The Panel thereby concluded that Pospelov violated CME Rules 575.A. and 576.

      PENALTY:

      In accordance with the settlement offer, the Panel ordered Pospelov to pay a $40,000 fine and serve a 30-day suspension of any access to any CME Group Inc. trading floor and of direct and indirect access to all electronic trading and clearing platforms owned or controlled by CME Group Inc., including CME Globex. The suspension shall run from April 11, 2019, through May 11, 2019, inclusive.

      EFFECTIVE DATE:

      April 11, 2019