NOTICE OF DISCIPLINARY ACTION

FILE NO.:

CBOT 11-8447-BC

NON-MEMBER:

INDUS DERIVATIVES LTD.

CBOT RULE VIOLATION:

432 GENERAL OFFENSES (in part)

It shall be an offense:

Q. to commit an act which is detrimental to the interest or welfare of the Exchange or to engage in any conduct which tends to impair the dignity of good name of the Exchange;

T. to engage in…uncommercial conduct;

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

FINDINGS:

Pursuant to an offer of settlement in which Indus Derivatives Ltd. (“Indus”), now doing business as Mercury Derivatives Trading Ltd., neither admitted nor denied the rule violations upon which the penalty is based, and after voluntarily submitting itself to the jurisdiction of the Exchange for purposes of resolving the matter, on October 22, 2013, a Panel of the CBOT Business Conduct Committee found that on one or more occasions between June 1, 2011, and March 31, 2012, Indus traders entered orders in various Agricultural contracts on the CME Globex electronic trading platform during the pre-opening session that were not made in good faith for the purpose of executing bona fide transactions. The entry and cancelation of these orders caused fluctuations in the publicly displayed Indicative Opening Price (“IOP”). The Panel concluded that Indus thereby violated CBOT Rules 432.Q., 432.T., and 432.W.

 

PENALTY:

In accordance with the settlement offer, the Panel fined Indus $150,000.

EFFECTIVE DATE:

October 24, 2013