NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

MICHAEL FRANKO

EXCHANGE RULES:

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 that Michael Franko (“Franko”) presented at a hearing on August 19, 2015, in which Franko neither admitted nor denied the factual allegations or rule violations upon which the penalty is based, a Panel of the COMEX Business Conduct Committee (“Panel”) found it had jurisdiction over Franko pursuant to Exchange Rules 402 and 418 and that on various trade dates during the time period from May 2013 through January 2014, Franko entered orders in Copper futures contracts without the intent to trade. Specifically, Franko entered these orders and then cancelled them a few seconds after resting iceberg orders on the opposite side of the book were executed.

The Panel concluded that Franko violated Exchange Rules 432.B.2., 432.Q., and 432.T.

PENALTY:

In accordance with the settlement offer, the Panel ordered Franko to pay a fine to the Exchange in the amount of $100,000 and to serve a 15 business day suspension of access to any CME Group Inc. trading floor and of direct access to all electronic trading and clearing platforms owned or controlled by CME Group Inc., including CME Globex. The suspension shall run from August 21, 2015 to September 11, 2015, inclusive.