NOTICE OF DISCIPLINARY ACTION

MEMBER:

EAGLE SEVEN LLC

NYMEX RULE VIOLATIONS:

RULE 432.W. GENERAL OFFENSES (IN PART)

It shall be an offense:

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

RULE 562. POSITION LIMIT VIOLATIONS

Any positions in excess of those permitted under the rules of the Exchange shall be deemed position limit violations.

RULE 575.D. DISRUPTIVE PRACTICES PROHIBITED (IN PART)

No person shall enter or cause to be entered an actionable or non-actionable message(s) with intent to disrupt, or with reckless disregard for the adverse impact on, the orderly conduct of trading or the fair execution of transactions.

FINDINGS:

Pursuant to an offer of settlement in which Eagle Seven LLC neither admitted nor denied the rule violations or factual allegations upon which the penalty is based, on December 14, 2023, a Panel of the NYMEX Business Conduct Committee (“Panel”) found that on trade date February 18, 2022, Eagle Seven held a long intraday March 2022 Light Sweet Crude Oil Futures (“MAR22 Crude Oil”) position that was 2,138 contracts, or 42.76%, over the spot-month limit. The Panel also found that Eagle Seven liquidated its position during the settlement period on February 18, 2022, and accounted for more than 55% of the volume traded during the settlement period. Eagle Seven’s liquidation of its position during the settlement window was entered with a reckless disregard for the adverse impact on the orderly conduct of trading or the fair execution of transactions in the MAR22 Crude Oil futures contract. Eagle Seven’s liquidation of its position resulted in a $470,360 profit. The Panel further found that Eagle Seven failed to diligently supervise its employee who engaged in the activity at issue by not providing sufficient compliance training and/or educational materials regarding NYMEX rules, and failed to diligently supervise his trading, to ensure compliance with NYMEX rules regarding position limits and disruptive trading practices.

The BCC Panel found that, as a result, Eagle Seven violated NYMEX Rules 432.W., 562, and 575.D.

PENALTY:

In accordance with the settlement offer, the BCC ordered Eagle Seven to pay a fine in the amount of $115,000 and disgorge $470,360 in profit.