NOTICE OF DISCIPLINARY ACTION

FILE NO.:

CBOT 10-04522-BC

NON-MEMBER CLERK:

JAMES CAREY

CBOT RULES:

576. Identification of Globex Terminal Operators

Each Globex terminal operator shall be identified to the Exchange, in the manner prescribed by the Exchange, and shall be subject to Exchange rules. . . . In no event may a person enter an order or permit the entry of an order by an individual using a user ID other than the individual’s own unique user ID.

536. Recordkeeping Requirements for Pit, Globex and Negotiated Trades (In Part)

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B. Globex Order Entry (In Part)

1. General Requirement

Each Globex terminal operator entering orders into Globex shall input for each order: a) user ID assigned him by the Exchange, a clearing member or other authorized entity and b) the price, quantity, product, expiration month, CTI code and account number . . . .

534. Wash Trades Prohibited

No person shall place or accept buy and sell orders in the same product and expiration month, and, for a put or call option, the same strike price, where the person knows or reasonably should know that the purpose of the orders is to avoid taking a bona fide market position exposed to market risk (transactions commonly known or referred to as wash sales). . . .

FINDINGS:

Pursuant to an offer of settlement in which James Carey neither admitted nor denied the findings, on September 23, 2010, a Panel of the CBOT Business Conduct Committee found that James Carey, a non-member clerk employed by a member firm, accessed the Globex platform using a user ID other than his own for a period of time; entered orders into the Globex platform without identifying the correct account number for the orders for a period of time; and entered buy and sell orders for the same beneficial owner into the Globex platform with the intention that the orders would match resulting in prohibited wash sales.

The Panel found that in doing so James Carey violated CBOT Rules 576, 536.B. and 534.

PENALTY:

In accordance with the settlement offer, the Panel fined James Carey $15,000 and suspended his access to any CME Group trading floor and direct access to any CME Group electronic trading or clearing platform for 20 business days.

His suspension shall run from September 27, 2010, to October 22, 2010, inclusive.

EFFECTIVE DATE:

September 27, 2010