NOTICE OF DISCIPLINARY ACTION

FILE NO.:

CBOT 12-9129-BC

MEMBER:

Richard Joseph Guth

CBOT RULE VIOLATION:

Rule 521 (“Trading Practices”)(in part)

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.

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 Rick Guth (“Guth”) neither admitted nor denied the rule violations upon which the penalty is based, on August 19, 2014, a Panel of the Chicago Board of Trade (“CBOT”) Business Conduct Committee (“Panel”) found that it had jurisdiction over Guth pursuant to Rules 400 and 402 as the conduct occurred while Guth was a CBOT member, and that on one or more occasions between April 10, 2012, and May 10, 2012, Guth engaged in Corn futures trades opposite a broker that had not been executed by open outrcry. Specifically, although Guth and the broker did not bid or offer openly to the pit, Guth recorded equal-quantity buys and sells that later cleared in Guth’s account opposite the broker on three trade dates. Guth realized $1,375 in profits as a result of the trades. The Panel concluded that Guth thereby violated CBOT Rules 521 and 539.

PENALTY:

In accordance with the settlement offer, the Panel ordered Guth to pay a fine of $5,000 and disgorge $1375 in profit. The Panel also suspended Guth for a period beginning on the effective date lasting 15 business days from accessing all CME Group Inc. trading floors, and indirect and direct access to all electronic trading and clearing platforms owned or controlled by CME Group Inc. The suspension shall run from August 21, 2014, through and including September 11, 2014.

EFFECTIVE DATE:

August 21, 2014