NOTICE OF DISCIPLINARY ACTION

MEMBER:

WILLIAM SILVA

CME RULE VIOLATIONS:

Rule 432. General Offenses (in part)

It shall be an offense:

B.2. to engage in conduct or proceedings inconsistent with just and equitable principles of trade;

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 or good name of the Exchange;

T. to engage in dishonorable or uncommercial conduct.

FINDINGS:

Pursuant to an offer of settlement in which William Silva (“Silva”) neither admitted nor denied the rule violations upon which the penalty is based, on August 19, 2015, a Panel of the CME Business Conduct Committee (“BCC” or “Panel”) found that it had jurisdiction over Silva pursuant to CME Rules 400 and 402 as the conduct occurred while Silva was an employee of a CME member firm. The Panel also found that during the time period from April 2013 through June 2013, Silva engaged in a pattern of activity in the E-Mini S&P 500 Mid-Cap futures contract market wherein he entered a larger-sized order and multiple smaller-sized sell (buy) orders at various book levels at or near the best offer (bid) on the CME Globex electronic trading platform (“Globex”). This order entry had the purpose and effect of prompting other market participants to join, and improve, the best offer (bid). Silva subsequently entered an aggressive smaller-sized buy (sell) order that traded immediately. After the buy (sell) order traded, Silva entered a series of smaller-sized buy (sell) orders at or near the best bid (offer). Once the smaller-sized orders began trading, Silva canceled all of the contracts resting on the offer (bid). The Panel concluded that Silva thereby violated CME Rules 432.B.2., 432.Q., and 432.T.

PENALTY:

In accordance with the settlement offer and in connection with companion case NYMEX 13-9387, the Panel ordered Silva to pay a total fine to the Exchange in the amount of $75,000 and serve a two week suspension of access to any CME Group Inc. trading floor and of direct and indirect access to all electronic trading and clearing platforms owned or controlled by CME Group, Inc., including CME Globex. A $25,000 fine is allocated to CME, and a $50,000 fine and two week suspension is allocated to NYMEX. The suspension shall run from August 21, 2015, through September 4, 2015, inclusive.

EFFECTIVE DATE:

August 21, 2015