NOTICE OF DISCIPLINARY ACTION

FILE NO.:

CBOT 19-1157-BC

NON-MEMBER:

Angelica Rodrigues

CBOT RULE VIOLATION:

Rule 534 Wash Trades Prohibited

No person shall place or accept buy and sell orders in the same product and expiration month, and, for a put or call option, the same strike price, where the person knows or reasonably should know that the purpose of the orders is to avoid taking a bona fide market position exposed to market risk (transactions commonly known or referred to as wash trades or wash sales). Buy and sell orders for different accounts with common beneficial ownership that are entered with the intent to negate market risk or price competition shall also be deemed to violate the prohibition on wash trades. Additionally, no person shall knowingly execute or accommodate the execution of such orders by direct or indirect means.

CBOT Market Regulation Advisory Notice RA 1614-5 (in part)

Q18: Is it a violation of Rule 534 if resting orders in the order book entered during the Globex pre-open match opposite one another once the market opens?

A18: Yes, if a self-match occurs when the market opens as a result of orders entered during the Globex pre-open state that a party knew or should have known would match, then the party has violated Rule 534. Parties should have a reasonable expectation that their resting buy and sell orders may match when the market opens if the buy orders are priced at or above the price of their resting sell orders or the sell orders are priced at or below the price of their resting buy orders.

FINDINGS:

Pursuant to an offer of settlement in which Angelica Rodrigues (“Rodrigues”) neither admitted nor denied the rule violations upon which the penalty is based, on April 20, 2020, a Panel of the Chicago Board of Trade (“CBOT”) Business Conduct Committee (“Panel”) found that between March 14, 2019, and April 17, 2019, Rodrigues entered buy and sell orders on the CME Globex trading platform during the pre-open sessions in the May 2019 and July 2019 Soybean futures on behalf of her employer’s accounts with common beneficial ownership. These orders self-matched upon the opening of the markets. The Panel also found that Rodrigues should reasonably have known that the placement of orders in the pre-open session would not result in a bona fide market position exposed to market risk.

The Panel concluded that Rodrigues thereby violated CBOT Rule 534.

PENALTY:

In accordance with the settlement offer, the Panel ordered Rodrigues to pay a fine of $15,000. The Panel also suspended Rodrigues 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 five (5) business days, beginning on the effective date below and continuing through and including April 28, 2020.

EFFECTIVE DATE:

April 22, 2020