NOTICE OF DISCIPLINARY ACTION

FILE NO.:

CBOT 11-8125-BC

MEMBER:

Daniel T. Zagorin (DTZ)

CBOT RULE VIOLATIONS:

(Legacy) Rule 443. Position Limit Violations

The Market Regulation Department and the BCC shall have the authority to enforce the position limit rules of the Exchange. For purposes of this rule, any positions in excess of those permitted under the rules of the Exchange shall be deemed position limit violations. Additionally, any person making a bid or offer that would, if accepted, cause such a person to exceed the applicable position limits shall be in violation of this rule.

Rule 10102.E. Position Limits (Corn Futures) (in part)

In accordance with Rule 559., Position Limits and Exemptions, no person shall own or control positions in excess of:

1. 600 contracts net long or net short in the spot month.

FINDINGS:

Pursuant to an offer of settlement in which Daniel T. Zagorin neither admitted nor denied the rule violations upon which the penalty is based, on December 20, 2011, a Panel of the CBOT Business Conduct Committee found that on February 26, 2010, Zagorin failed to adhere to the spot month speculative position limit for Corn futures by entering an order to purchase 750 March – May 2010 Corn futures. At this time, Zagorin had already established a long March Corn futures position of 123 contracts. Zagorin’s order was filled in its entirety in 20 milliseconds, causing his March 2010 Corn futures position to peak at 873 contracts long, exceeding the spot month speculative position limit of 600 contracts by 273 contracts. The Panel found that in so doing, Zagorin violated legacy CBOT Rule 443. (Position Limit Violations).

PENALTY:

In accordance with the settlement offer and in consideration of Zagorin’s history of position limit violations, the Panel fined Zagorin $60,000 and suspended his membership privileges, access to any CME Group trading floors, and direct access to any CME Group electronic trading or clearing platform for 15 business days, beginning on December 27, 2011, and continuing through and including January 17, 2012.

EFFECTIVE DATE:

December 27, 2011