• NOTICE OF DISCIPLINARY ACTION

      • #
      • NYMEX 17-0789-BC
      • Effective Date
      • 30 January 2020
    • MEMBER:

      Tanius Technology LLC

      NYMEX RULE VIOLATIONS:

      Rule 432 General Offenses

      It shall be an offense:

      Q. to commit an act which is detrimental to the interest or welfare of the Exchange or to engage in any conduct which tends to impair the dignity or good name of the Exchange;

      W. for any party to fail to diligently supervise its employees and agents in the conduct of their business relating to the Exchange;

      FINDINGS:

      Pursuant to an offer of settlement in which Tanius Technology LLC neither admitted nor denied the rule violations upon which the penalty is based, on January 28, 2020, a Panel of the New York Mercantile Exchange Business Conduct Committee (“Panel”) found that between June 1, 2017, and May 31, 2018, Tanius engaged in a pattern of activity in which an automated trading system Tanius operated entered price modifications in various Energy Options contracts with incrementally widening spreads between the bid and the offer prices, causing aberrant bid and offer prices to be disseminated to the market. After first being notified of the issue by Market Regulation, Tanius modified its algorithm but failed to adequately rectify the problem, leading to several other price widening instances and additional notifications by Market Regulation. After further modifications by Tanius, Tanius sufficiently resolved the problem.

      The Panel concluded that as a result of the foregoing, Tanius violated NYMEX Rules 432.Q. and 432.W.

      PENALTY:

      In accordance with the settlement offer, the Panel ordered Tanius to pay a fine in the amount of $35,000.