NOTICE OF SUMMARY ACTION

FILE NO:

CBOT DQA‐22-0999

MEMBER FIRM:

R.J. O’BRIEN & ASSOCIATES LLC

RULE VIOLATION:

RULE 536.B GLOBEX ORDER ENTRY

1.  GENERAL REQUIREMENT

Each Globex terminal operator entering orders into Globex shall accurately input for each Application Message all fields required to be populated by the CME iLink® Message Specifications set forth in the CME Group Client Systems Wiki in effect at the time, including, but not limited to the: operator ID; price; quantity; product; expiration month; CTI code; manual order indicator; and account number…

RULE 536.C.  BUNCHED ORDERS AND ORDERS ELIGIBLE FOR POST EXECUTON ALLOCATION

Bunched orders must be allocated and recorded in accordance with CFTC Regulation 1.35(b) and the NFA’s Interpretive Notice related to Compliance Rule 2-10.

With respect to bunched Globex orders, such orders may be entered using a series designation or suspense account number provided that 1) the order is being placed by an eligible account manager for multiple accounts eligible for post execution allocation or 2) a written, pre-determined allocation scheme that defines the series has been provided to the futures commission merchant accepting or clearing the order prior to the time that such order is entered. In the latter case, if such information has not been provided to the futures commission merchant prior to the time of order entry, each specific account number must be entered into Globex. Additionally, for all such bunched orders executed on Globex, the final account specific allocations must be submitted to the clearing system no later than the end of each trading day.

FINDINGS:

During the period of April 1, 2022 through June 30, 2022, R.J. O’Brien & Associates LLC violated Rule 536.B.1 by submitting incorrect account numbers at order entry and Rule 536.C. by failing to meet the documentation requirements for orders entered using Execution Operation Suspense Accounts and failing to properly use Execution Operation Suspense Accounts.

PENALTY:

On December 14, 2022, R.J. O’Brien & Associates LLC, pursuant to Rule 512 (“Reporting Infractions”), was collectively issued a $2,000 fine for its violations of Rules 536.B.1 and 536.C (see companion case CME DQA-22-0999):  CME - $1,000; CBOT - $1,000.

EFFECTIVE DATE:

January 4, 2023