NOTICE OF DISCIPLINARY ACTION

MEMBER:

Kevin Patrick Loftus (KEV)

CBOT RULE VIOLATIONS:

Rule 521. Requirements for Open Outcry Trades

In open outcry trading, bidding and offering practices must at all times be conducive to the competitive execution of transactions. All open outcry transactions, including spread and combination transactions, shall be made openly and competitively in the pit designated for the trading of the particular transaction. No bid or offer shall be specified for acceptance by a particular trader. Transactions may take place only at the best price available in the open outcry market at the time the trade occurs.

(Legacy) Rule 432. General Offenses (in part)

B. It shall be an offense to engage in fraud, bad faith or in conduct or proceedings inconsistent with just and equitable principles of trade.

Rule 539. Prearranged, Pre-negotiated and Noncompetitive Trades Prohibited (in part)

A. General Prohibition

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

FINDINGS:

Pursuant to an offer of settlement in which Kevin Patrick Loftus (KEV) neither admitted nor denied the rule violations upon which the penalty is based, on December 17, 2015, a Panel of the CBOT Business Conduct Committee (“Panel”) found that it had jurisdiction over Loftus pursuant to CBOT Rules 400 and 402 as the conduct occurred while he was a CBOT member. The Panel also found that on one or more occasions from April 9, 2009, through May 7, 2010, Loftus engaged in trades as a local, and one trade as a broker, in the Corn futures pit that were not competitively executed by open outcry, and realized $1,787.50 in profits as a result of such trades as a local. The Panel concluded that Loftus thereby violated CBOT Rules 521, (legacy) 432.B., and 539.A.

PENALTY:

In accordance with the settlement offer and after taking Loftus’s financial condition into consideration when levying the sanction, the Panel ordered Loftus to serve a 30 day suspension from accessing any trading floor owned or controlled by CME Group and direct access to all electronic trading and clearing platforms owned or controlled by CME Group, including CME Globex. The Panel also ordered Loftus to pay $1,787.50 in disgorgement. The suspension shall run from December 21, 2015 through January 20, 2016, inclusive.

EFFECTIVE DATE:

December 21, 2015