Deutsche Bank AG was fined US $20,000 and required to disgorge profits of almost US $175,000 related to a single instance of violating position limits on ICE Futures U.S. According to the exchange, DB exceeded the spot month speculative position limit for the February 2014 contract expiration of the Henry Hub LD1 Fixed Prices futures contract. Separately, CME Group fined one member and two non-members with failing to maintain required documents regarding a single exchange of futures for a related position transaction. In two of the matters—one involving Kempler & Co., Inc., and the other, PFL Futures Limited, both non-members—CME Group found there was no relevant documentation, while in the other—involving Kataman Metals LLC, a member—it found there was insufficient documentation. Kempler and PFL were each fined US $10,000 while Kataman was fined US $15,000.
Compliance Weeds: Repeatedly, exchanges are requiring disgorgement of profits as part of a sanction related to a speculative limit violation. Here the majority of Deutsche Bank’s sanctions by ICE Futures US was repayment of trading profits. This is consistent with a prior action by the same exchange also involving a speculative limit violation earlier this year. (Click here to access the article “ICE Futures U.S. Sanctions Energy Fund for Alleged Position Limit Violations” in the August 11 to 15 and 18, 2014 edition of Bridging the Week.) The Chicago Mercantile Exchange Group has likewise required disgorgement in connection with speculative limit violations. (Click here to access the article “CFTC and CME Bring and Settle Actions for Speculative Position Limit Violations; One CME Action Is for an Intra-day Violation.” In the April 28 to May 2 and May 5, 2014 edition of Bridging the Week.)