NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

JB DRAX HONORE UK LTD.

CME RULE VIOLATIONS:

432 GENERAL OFFENSES (in part)

It shall be an offense:

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 JB Drax Honore UK Ltd. (“JB Drax UK”) neither admitted nor denied the rule violations upon which the penalty is based, on May 21, 2015, a Panel of the CME Business Conduct Committee (“Panel”) found that it had jurisdiction over JB Drax UK pursuant to Rules 400 and 402 as the conduct occurred while JB Drax UK was an affiliate of a CME member. The Panel also found that between January 17, 2012, and August 2, 2013, various JB Drax UK desk brokers engaged in a pattern of conduct in Eurodollar options on futures whereby the desk brokers, both individually and in conjunction with other JB Drax UK desk brokers, engaged in pre-execution communications and disclosed customers’ nonpublic order information for the purpose of prearranging the execution of the orders opposite other customers’ orders in their possession, and executed the orders at market prices. The Panel further found that JB Drax UK employees presented the orders to the pit only after securing both sides of the transaction or guaranteeing a fill to the customer. Moreover, the Panel found that JB Drax UK failed to diligently supervise these employees in a manner sufficient to ensure that their conduct was consistent with Exchange rules. The Panel concluded that JB Drax UK thereby violated CME Rule 432.W.

PENALTY:

In accordance with the settlement offer, the Panel ordered JB Drax UK to pay a fine of $55,000.

EFFECTIVE DATE:

May 26, 2015