NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

Huikon Capital Inc.

EXCHANGE RULES:

Rule 432. GENERAL OFFENSES

W. for any party to fail to diligently supervise its employees and agents in the conduct of their business relating to the Exchange.

Rule 534. – Wash Trades Prohibited

No person shall place or accept buy and sell orders in the same product and expiration month, and, for a put or call option, the same strike price, where the person knows or reasonably should know that the purpose of the orders is to avoid taking a bona fide market position exposed to market risk (transactions commonly known or referred to as wash sales). Buy and sell orders for different accounts with common beneficial ownership that are entered with the intent to negate market risk or price competition shall also be deemed to violate the prohibition of wash trades. Additionally, no person shall knowingly execute or accommodate the execution of such orders by direct or indirect means.

FINDINGS:

Pursuant to an offer of settlement that Huikon Capital Inc. (“Huikon”) presented at a hearing on September 30, 2015 in which Huikon neither admitted nor denied the rule violations upon which the penalty is based, a Panel of the NYMEX Business Conduct Committee (“Panel”) found that Huikon is subject to the jurisdiction of the Exchange pursuant to Rules 400 and 418 and that on March 5, 2014, and March 26, 2014, two Huikon traders entered a series of wash trades in Crude Oil Calendar Spreads between accounts with the same beneficial owner. Huikon failed to diligently supervise its traders in a manner sufficient to ensure that they were familiar with Exchanges rules.

The Panel found that as a result of the foregoing, Huikon violated NYMEX Rules 432.W and 534.

PENALTY:

In accordance with the settlement offer, the Panel ordered Huikon to pay a fine to the Exchange in the amount of $40,000.