NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

Eugene Investment & Futures Co. Ltd.

EXCHANGE RULES:

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 in which Eugene Investment & Futures Co. Ltd. (“Eugene”) neither admitted nor denied the Rule violations or factual findings upon which the penalty is based, on October 19, 2021 a Panel of the NYMEX Business Conduct Committee (“Panel”) found that on May 8 and May 11, 2020, Eugene employees placed opposing orders in October 2020 NYMEX Crude Oil futures for accounts with common beneficial ownership, resulting in those orders trading opposite one another. The Eugene employees placed the opposing buy and sell orders with the knowledge and intent that the orders would trade opposite one another, for the purpose of transferring positions. Additionally, the Panel found that Eugene 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, Eugene violated NYMEX Rules 534 (“Wash Trades Prohibited”) and 432.W. (“General Offenses – Failure to Supervise”).

PENALTY:

In accordance with the settlement offer, the Panel ordered Eugene to pay a fine to the Exchange in the amount of $30,000.