EXCHANGE RULE 575.A. DISRUPTIVE PRACTICES PROHIBITED
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.
EXCHANGE RULE 576. IDENTIFICATION OF GLOBEX TERMINAL OPERATORS
Each Globex terminal operator shall be identified to the Exchange, in the manner prescribed by the Exchange, and shall be subject to Exchange rules. If user IDs are required to be registered with the Exchange, it is the duty of the clearing member to ensure that registration is current and accurate at all times. 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.
Pursuant to an offer of settlement that Hongchae Chung (“Chung”) presented at a hearing on December 12, 2019, in which Chung neither admitted nor denied the rule violation upon which the below penalty is based, a Panel of the COMEX Business Conduct Committee (“BCC Panel”) found that, between August 2017 and March 2018, Chung, suing unique Globex User IDs (“Tag 50 ID”) engaged in disruptive trading activity in the Gold and Copper Futures contract markets by entering orders without the intent to trade. Specifically, the Panel found that Chung typically entered larger orders on one side of the market and then cancelled them after resting smaller orders on the opposite side of the book were executed.
The BCC Panel found that, as a result, Chung violated Exchange Rules 575.A. and 576.
In accordance with the settlement offer, the BCC Panel ordered Chung to pay a monetary fine in the amount of $90,000, i.e., $70,000 of the monetary fine is allocated to COMEX 18-0910-BC and $20,000 is allocated to NYMEX 18-0910-BC, (2) to disgorge total profits in the amount of $19,018, i.e., $9,710 of the profit disgorgement is allocated to COMEX 18-0910-BC and $9,308 is allocated to NYMEX 18-0910-BC, and (3) and to serve a three month trading suspension 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. The suspension shall run from December 16, 2019 through, and
including March 16, 2020.