NOTICE OF DISCIPLINARY ACTION

FILE NO.: 

COMEX 10-07511-BC

MEMBER:

DOMINIQUE COGNATA (DGAL)

COMEX RULE VIOLATION:

Legacy COMEX Rule 104.21 – OPEN OUTCRY

Except to the extent otherwise permitted by the By-Laws and Rules, every order to buy and sell, and every purchase and sale of, a futures contract or futures option must be offered or executed openly and competitively by public outcry in a ring specified in the By-Laws and Rules.

NYMEX RULE VIOLATION:

Legacy NYMEX Rule 8.55 – CLASSIFICIATION OF OFFENSES

(B) Minor Offenses – No Member, Member Firm, or any employee of the foregoing shall commit a violation of any of the following rules, which shall be deemed minor offenses of the Exchange.

(2) to engage in conduct inconsistent with just and equitable principles of trade.

FINDINGS:

Pursuant to an offer of settlement in which Dominique Cognata (“Cognata”) neither admitted nor denied the rule violations upon which the penalty is based for purposes of resolving this matter, on August 9, 2011, a panel of the COMEX Business Conduct Committee (the “Panel”) found that in October 2008, Cognata engaged in two (2) noncompetitive, prearranged trades of COMEX Silver and Gold options opposite a broker’s customer order without bidding or offering in the ring.

The Panel further found that on three (3) occasions from October 2008 through December 4, 2008, Cognata accepted profiting round-turn transactions into her personal account that were executed noncompetitively by another trader. As a result of these noncompetitive trades, Cognata profited $6,250 in ill-gotten gains.

The Panel found that in so doing, Cognata violated Legacy COMEX Rule 104.21, and Legacy NYMEX Rule 8.55(B)(2).

PENALTY:

In accordance with the settlement offer, the Panel ordered Cognata to (i) pay a fine to the Exchange in the amount of $25,000; (ii) disgorge $6,250 in ill-gotten gains; and (iii) serve a suspension for a period beginning on the effective date of the Panel’s decision and lasting one (1) week from the date the fine is paid in full of her 1) membership privileges, 2) access to all CME Group Inc. trading floors, and 3) direct access to all electronic trading and clearing platforms owned or controlled by CME Group, including CME Globex.

EFFECTIVE DATE:

August 11, 2011