NOTICE OF DISCIPLINARY ACTION

MEMBER:

Jeffery Michael Miulli

CME RULE VIOLATIONS:

CME Rule 521. Requirements for Open Outcry Trades (in part)

In open outcry trading, bidding and offering practices must at all times be conducive to the competitive execution of transactions. All open outcry transactions, including spread and combination transactions, shall be made openly and competitively in the pit designated for the trading of the particular transaction. No bid or offer shall be specified for acceptance by a particular trader. Transactions may take place only at the best price available in the open outcry market at the time the trade occurs.

CME Rule 522. Acceptance of Bids and Offers

In electronic trading, while outstanding, all or any part of any bid or offer is subject to immediate acceptance by any trader. Members are required to honor all bids or offers which have not been withdrawn from the market. The price at which a trade is executed shall be binding, unless such trade is cancelled by Exchange officials in accordance with Exchange rules.

CME Rule 527. D. Errors and Mishandling of Orders

If a broker overbuys or oversells for an order, the customer is not entitled to any of the quantity executed in excess of the order quantity. A position that has been established as a result of an erroneous execution or mishandling of an order must be placed in the error account of the broker or firm responsible for the error or order mishandling. Any profits resulting from the liquidation of trades placed in a broker’s or firm’s error account belong to the relevant broker or firm, and any such profits may be retained or disbursed at the broker’s or firm’s discretion.

CME Rule 532. Disclosing Orders Prohibited

No person shall disclose another person's order to buy or sell except to a designated Exchange official or the CFTC, and no person shall solicit or induce another person to disclose order information. An order for pit execution is not considered public until it has been bid or offered by open outcry. No person shall take action or direct another to take action based on non-public order information, however acquired.

CME Rule 539. Pre-arranged, Pre-negotiated and Non-competitive Trades Prohibited

A. General Prohibition (in part): No person shall prearrange or pre-negotiate any purchase or sale or noncompetitively execute any transaction.

FINDINGS:

Pursuant to an offer of settlement in which Jeffery Michael Miulli neither admitted nor denied the rule violations or factual findings upon which the penalty is based, on September 30 2022, a Panel of the Chicago Mercantile Exchange (“CME”) Business Conduct Committee (“Panel”) found that on one or more occasions on February 11, 2020, and February 12, 2020, Miulli and another trading desk broker and occasional broker in the S&P options pit, engaged in pre-arranged and directed trades in the FX options pit regarding the purchase or sale of March 2020 and April 2020 Japanese Yen Box spread trades. On both dates Miulli and the other broker had numerous phone conversations with each other prior to the subject trades being executed in the FX options pit and disclosed non-public order information pertaining to Japanese Yen box spreads, including side of market, size of orders and price. Additionally, on February 12, 2020, Miulli improperly resolved an apparent error by busting a trade in the FX options pit after its execution.

The Panel concluded that Miulli thereby violated CME Rules 521, 522, 527.D., 532, and 539.A.

PENALTY:

In accordance with the settlement offer, and after taking Miulli’s financial condition into consideration when it levied the sanction, the Panel ordered Miulli to pay a fine in the amount of $10,000 and suspended his 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 a period of one month, beginning on the effective date and continuing for one month from the date that the ordered fine is paid.