CME Sanctions Trader for Spoofing

The Chicago Mercantile Exchange ("CME") fined and suspended a trader for disruptive trading practices ("spoofing").

In a disciplinary action, the CME Business Conduct Committee found that a trader entered orders in separate markets (Australian Dollar, Euro FX, New Zealand Dollar, Canadian Dollar and British Pound futures markets) "with the intent, at the time of order entry, to cancel the order before execution or to modify the order to avoid execution or with the intent to mislead other market participants." The BCC found that once smaller and passive orders were executed, the trader would cancel larger orders on the opposite side of the market. The CME also said that the trader failed to appear at a scheduled staff interview.

As a result of this conduct, the CME found that the trader violated CME Rules 432 ("General Offenses") and 575 ("Disruptive Practices Prohibited").

The CME imposed (i) a $70,000 fine and (ii) a permanent suspension from access to trading floors.