NOTICE OF DISCIPLINARY ACTION

FILE NO.:

CME 17-0811-BC

NON-MEMBER:

Kyulim Cho

CME RULE VIOLATIONS:

Rule 575 Disruptive Practices Prohibited (in part)

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 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.

FINDINGS:

On August 20, 2019, a Panel of the Chicago Mercantile Exchange (“CME”) Probable Cause Committee (“PCC”) charged non-member Kyulim Cho (“Cho”) with violating CME Rules 575.A., and 432.L.1. based on allegations that on one or more occasions on August 13, 2017, and August 16, 2017, Cho entered orders without the intent to trade in the September 2017 E-Mini NASDAQ 100 futures markets (“Sep17 NASDAQ”). Specifically, Cho entered a larger order on one side of the market and then canceled the larger order after receiving a fill on his smaller orders resting on the opposite side of the book. Further, Cho failed to appear before Exchange staff for a scheduled interview.

On November 11, 2019, a Hearing Panel Chair of the Chicago Mercantile Exchange Business Conduct Committee (“BCC”) entered an order finding that Cho failed to answer the charges issued against him. In failing to answer the charges, the Hearing Panel Chair further ordered that Cho was deemed to have admitted the charges issued and waived his right to a hearing on the merits of the charges.

Pursuant to Exchange Rule 407.C., a penalty hearing was held before a Panel of the BCC (“Panel”) on November 25, 2019. The Panel found Cho guilty of committing the admitted charges.

PENALTY:

Based on the record and the Panel’s findings and conclusions, the Panel ordered Cho to pay a fine in the amount of $60,000, and to permanently bar Cho 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.

EFFECTIVE DATE:

December 13, 2019