CME Group fines, suspends trader for violating wash trades prohibition

International derivatives marketplace CME Group has posted a notice of disciplinary action against Jeong Taewon.

The Chief Regulatory Officer of CME Group’s Market Regulation Department issued a charge against Jeong Taewon for violating Rule 534. based on allegations that, from July 19, 2022, through September 27, 2022, Jeong knowingly placed buy and sell orders in the same product and expiration month, where he knew or reasonably should have known that the purpose of the orders was to avoid taking a bona fide market position exposed to market risk in the September 2022 E-mini S&P Options market.

On May 15, 2024, a Hearing Panel Chair of the CME Business Conduct Committee (BCC) first determined that Jeong, having failed to submit a written answer to the charges issued against him, was deemed to have admitted the charges. Jeong therefore waived his right to a hearing on the merits of the charges. Pursuant to Rule 408.F., a BCC Panel then found Jeong guilty of committing the admitted charge and held a penalty hearing thereafter.

Based on the record and the Panel’s findings and conclusions, the Panel ordered Jeong to pay a fine in the amount of $50,000 and to serve a three-year suspension from access to any trading floor owned or controlled by CME Group and from direct and indirect access to any designated contract market, derivatives clearing organization or swap execution facility owned or controlled by CME Group.

The suspension will begin on May 31, 2024 and continue for three years from the date that payment of the fine is paid in full.