NOTICE OF DISCIPLINARY ACTION

FILE NO.:

NYMEX 11-08244-BC

NON-MEMBER:

Zone Equity Group, LLC
 

NYMEX RULE VIOLATION:

Rule 562. Position Limit Violations

Any positions in excess of those permitted under the rules of the Exchange shall be deemed position limit violations.

FINDINGS:

Pursuant to an offer of settlement in which Zone Equity Group, LLC (“Zone”), a non-member of the Exchange subject to its jurisdiction pursuant to NYMEX Rule 400, neither admitted nor denied the rule violation upon which the penalty is based, on May 22, 2012, a Panel of the NYMEX Business Conduct Committee (“The Panel”) found that on December 27, 2010, a date subject to a 1,000 contract expiration month position limit for the expiring January 2011 Henry Hub Natural Gas futures (“JAN11 NatGas”) contract, Zone held an aggregate intraday short position of 1,342 JAN11 NatGas contracts that exceeded the expiration month position limit by 342 contracts or 34.2% over the permitted level. Zone subsequently liquidated its overage position resulting in profits of $35,750.

The Panel found that in so doing, Zone violated NYMEX Rule 562 (“Position Limit Violations”).

PENALTY:

In accordance with the settlement offer, The Panel ordered Zone to pay a fine of $20,000 and disgorge profits of $35,750.

EFFECTIVE DATE:

May 24, 2012