NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

3 CROWNS CAPITAL PTE LTD.

NYMEX RULES:

539. Prearranged, Pre-Negotiated and Noncompetitive Trades Prohibited (In Part)

539.A. General Prohibition

No person shall prearrange or pre-negotiate any purchase or sale or noncompetitively execute any transaction.

432. General Offenses (In Part)

It shall be an offense:

B.1. to engage, or attempt to engage, in fraud or bad faith;

C. to engage in dishonest conduct;

L.2. to fail to fully answer all questions or produce all books and records at such hearing or in connection with any investigation, or to make false statements; and

W. for any party to fail to diligently supervise its employees and agents in the conduct of their business relating to the Exchange.

FINDINGS:

On July 10, 2023, the Chief Regulatory Officer of CME Group’s Market Regulation Department issued charges against 3 Crowns Capital Pte Ltd. for violating Rules 539.A., 432.B.1., 432.C., 432.L.2., and 432.W., based on allegations that 3 Crowns knowingly made false representations in its application to CME Group’s International Incentive Program in order to receive reduced trading fees, receiving the reduced trading fees under the IIP, as well as engaging in dishonest conduct by misrepresenting itself as a proprietary trading firm in order to participate in the Program and financially benefit through the receipt of reduced trading fees. The CRO also issued charges that from July 2018, through July 2019, several 3 Crowns traders noncompetitively executed transactions in various Heating Oil, Palladium, RBOB, Crude Oil and Platinum futures and that 3 Crowns failed to fully answer all questions and produce all books and records in connection with an Exchange investigation. 3 Crowns was also charged with failing to diligently supervise its agents and employees in the conduct of their business relating to the Exchange.

On November 15, 2023, a Hearing Panel Chair of the NYMEX Business Conduct Committee (“BCC”) first determined that 3 Crowns, having failed to submit a written answer to the charges issued against it, was deemed to have admitted the charges. 3 Crowns therefore waived its right to a hearing on the merits of the charges. Pursuant to Rule 408.F., a BCC Panel then found 3 Crowns guilty of committing the admitted charges and held a penalty hearing thereafter.

PENALTY:

Based on the record and the Panel’s findings and conclusions, the Panel ordered 3 Crowns to pay a fine in the amount of $1,000,000 in connection with this case and companion case COMEX 19-1122-BC ($700,000 allocated to NYMEX), to disgorge profits in the amount of $3,398,251.18, and to serve a permanent suspension from direct 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.