NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

Levmet Holdings Ltd.

EXCHANGE RULE:

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 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.

RULE 432. GENERAL OFFENSES (in part)

It shall be an offense

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 that Levmet Holdings Ltd. (“Levmet”) presented at a hearing on December 10, 2020, in which Levmet neither admitted nor denied the findings, conclusions or any rule violations upon which the penalty is based, a Panel of the COMEX Business Conduct Committee (“Panel”) found that on several occasions between January 23, 2019 and August 29, 2019, Levmet employees placed opposing orders in various COMEX Copper futures products for accounts with common beneficial ownership, resulting in those orders trading opposite one another. Levmet employees placed certain of these orders with the knowledge and intention they would achieve a wash result, for the purposes of correcting errors and transferring positions between accounts. Additionally, the Panel found that Levmet failed to properly advise and train its employees as to relevant Exchange rules and Market Regulation Advisory Notices (“MRANs”) in a manner sufficient to ensure compliance with the same.

The Panel found that as a result of the foregoing, Levmet violated COMEX Rules 534 (“Wash Trades Prohibited”) and 432.W. (“General Offenses – Failure to Supervise”).

PENALTY:

In accordance with the settlement offer, the Panel ordered Levmet to pay a fine to the Exchange in the amount of $40,000.