NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

Jun-Ming Lai

COMEX RULES:

Rule 575. Disruptive Practices Prohibited (in part)

All orders must be entered for the purpose of executing bona fide transactions. Additionally, all non-actionable messages must be entered in good faith for legitimate purposes.

A. No person shall enter or cause to be entered an order with the intent, at the time of order entry, to cancel the order before execution or to modify the order to avoid execution.

B. No person shall enter or cause to be entered an actionable or non-actionable message or messages with intent to mislead other market participants.

FINDINGS:

Following an evidentiary hearing on the merits commenced on November 15, 2022, a Panel of the COMEX Business Conduct Committee (“Panel”) found that, on one or more occasions between April 2, 2020, and May 6, 2020, Jun-Ming Lai entered orders in the June 2020 COMEX Gold futures markets with the intent, at the time of order entry, to cancel the orders to avoid execution, and with the intent to mislead other market participants. Specifically, Lai entered these orders as layered orders on one side of the market and generally near the top of the order book. The Panel concluded that the strategy Lai implemented was in direct violation of Exchange Rules 575.A. and B.

Accordingly, the Panel found Lai guilty violating COMEX Rules 575.A and 575.B.

PENALTY:

Based upon the record and the Panel’s findings and conclusions, the Panel ordered Lai to pay a total fine in the amount of $80,000 in connection with this case and companion case NYMEX 20-1319-BC, $20,000 of which shall be paid to COMEX, and to serve a five-year trading 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 begin on June 2, 2023 and continue for five years from the date that payment of the fine is received in full.