NOTICE OF DISCIPLINARY ACTION

FILE NO.:

CBOT 15-0326-BC

NON-MEMBER:

Andrew Stanley Lombara

CBOT 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.

B. No person shall enter or cause to be entered an actionable or non-actionable message or messages with the intent to mislead other market participants.

FINDINGS:

Pursuant to an offer of settlement in which Andrew Stanley Lombara neither admitted nor denied the rule violation upon which the penalty is based, on December 19, 2019, a Panel of the CBOT Business Conduct Committee (“Panel”) found that between August 31, 2015, and January 8, 2016, Lombara used a disruptive strategy in the December 2015 and March 2016 U.S. Treasury Bond Futures markets with the intent to mislead other market participants. This strategy focused on the entry of large exposed orders, which in some cases had long resting times or cumulative exposure, to encourage other market participants to trade with smaller displayed iceberg orders Lombara placed on the opposite side of the order book. When utilizing this strategy, Lombara successfully traded significantly more contracts opposite his large exposure than on the same side.

The Panel found that as a result of the foregoing, Lombara violated CBOT Rule 575.B.

PENALTY:

In accordance with the settlement offer, the Panel ordered Lombara to pay to the Exchange a fine of $60,000 and suspended him from access to any trading floor owned or controlled by CME Group and from direct and indirect access to any designated contract market, derivatives clearing organization or swap execution facility owned or controlled by CME Group for ten business days, beginning on the effective date below and continuing through and including January 7, 2020.

EFFECTIVE DATE:

December 23, 2019