NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

Hsing Han Liu

NYMEX RULES:

Rule 432.G. General Offenses (In Part)

It shall be an offense to prearrange the execution of transactions in Exchange products for the purpose of transferring equity between accounts.

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.

FINDINGS:

Pursuant to an offer of settlement in which Hsing Han Liu neither admitted nor denied the findings, conclusions or any rule violations upon which the penalty is based, on November 17, 2021, a Panel of the NYMEX Business Conduct Committee (“Panel”) found that, on multiple occasions between June 1 and June 5, 2020, Liu prearranged the execution of buy and sell orders in the December 2020 Crude Oil 2800 and 3600 Call options markets between an account owned by Liu and an account another individual owned for the purpose of transferring a substantial amount of equity between these accounts. In addition, between February 26, 2020, and March 2, 2020, Liu placed opposing buy and sell orders in April 2020 Crude Oil futures and April 2020 Crude Oil 4600 Call options for the same account when he knew, or reasonably should have known, that the purpose of the orders was to avoid taking a bona fide market position exposed to market risk.

The Panel found that as a result of the foregoing, Liu violated NYMEX Rules 432.G and 534.

PENALTY:

In accordance with the settlement offer, the Panel ordered Liu to pay a fine to the Exchange in the amount of $40,000 and serve a 20 business day 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 November 19, 2021 through, and including, December 17, 2021.