NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

Lee Sung Ok

COMEX RULE VIOLATIONS:

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.

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

Rule 432. General Offenses (in part)

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;

FINDINGS:

On December 11, 2023, the Chief Regulatory Officer issued charges against Lee Sung Ok for violating Commodity Exchange (“COMEX”) Rules 575.B. and 432.L.2., based on allegations that on multiple occasions between June 18, 2021, and September 28, 2021, Lee entered actionable messages in various Copper, Silver, and Gold futures markets with the intent to mislead other market participants and receive favorable pricing. Lee layered orders of various quantities and prices on both sides of the market. She modified those orders to create a disproportionate quantity of contracts on one side of the market at the top levels of the order book. Lee exhibited a pattern of order entry and modification that alternated between creating buy-side pressure and sell-side pressure in order to induce market participants to trade into her smaller resting quantity on the opposite side. The imbalance induced market participants to trade into her orders for smaller quantities she entered or modified on both the opposite and same side of the market. The Panel further found that Lee failed to fully answer all questions in connection with Market Regulation’s investigation into her conduct.

On July 16, 2024, a Hearing Panel Chair of the COMEX Business Conduct Committee (“BCC”) first determined that Lee, having failed to submit a written answer to the charges issued against her, was deemed to have admitted the charges. Lee therefore waived her right to a hearing on the merits of the charges.

Pursuant to COMEX Rule 408.F., a BCC Panel then found Lee 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 that Lee pay a fine of $100,000 ($50,000 of which is allocated to COMEX). The Panel also permanently suspended Lee 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 beginning on the effective date below.

EFFECTIVE DATE:

August 5, 2024