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ICE Futures Broke Law "Thousands" Of Times In 20 Months, CFTC Fines Exchange 0.75% Of 2015 Revenues

Tyler Durden's picture




 

From October 2012 to May 2014, the CFTC found that ICE Futures exchange submitted reports and data containing errors and omissions on every reporting day, with cumulative inaccuracies totaling in the thousands. The CFTC stated unequivocally that, those "who fail to meet their reporting obligations will be held accountable," and required ICE to pay a $3 million civil monetary penalty. With expectations of over $4 billion in revenues for FY 2015, the $3 million fine represents just 0.75% of the exchange's income... that will teach them!!!

 

Full CFTC Statement:
CFTC Orders ICE Futures U.S., Inc. to Pay a $3 Million Civil Monetary Penalty for Recurring Data Reporting Violations

The U.S. Commodity Futures Trading Commission (CFTC) today issued an Order filing and simultaneously settling charges against ICE Futures U.S., Inc. (ICE), a designated contract market (DCM), for submitting inaccurate and incomplete reports and data to the CFTC over at least a 20-month period, from at least October 2012 through at least May 2014.

 

According to the CFTC Order, on every reporting day during the period above, ICE submitted reports and data containing errors and omissions, with cumulative inaccuracies totaling in the thousands. The Order further finds that CFTC staff repeatedly notified ICE of the problems with its reports and data and requested that ICE take action to correct the mistakes, but that ICE continued to submit inaccurate reports and data. The Order requires ICE to pay a $3 million civil monetary penalty and to comply with undertakings aimed at improving its regulatory reporting.

 

CFTC Director of Enforcement Aitan Goelman commented: “The CFTC cannot carry out its vital mission of protecting market participants and ensuring market integrity without correct and complete reporting by registrants, including DCMs. Today’s action makes clear that registrants who fail to meet their reporting obligations will be held accountable and that the CFTC takes a particularly dim view of reporting violations that continue over many months, especially after CFTC staff has repeatedly alerted the registrant in question to the problems in its reporting.”

 

Pursuant to Part 16 of the CFTC Regulations, a DCM is required to submit certain trading and market-related reports and data to the CFTC. In particular, a DCM is required to submit, for each business day, clearing member reports showing certain information for each future or option contract, including, among other things, the quantity of contracts currently open, the quantity of contracts bought and sold throughout the day, and the quantity of delivery notices. A DCM is also required to provide the CFTC with permanent record data relating to trading volume, open contracts, prices, and certain critical dates, and transaction-level trade data and related order information for each futures or options contract.

 

The Order specifically finds that, beginning in at least October 2012, CFTC staff notified ICE about its data and reporting errors, which included incorrect clearing member reports, permanent record data, and transaction-level trade data. ICE responded that these errors resulted primarily from technology upgrades and data migration projects, and while they affected data provided to the CFTC, they did not affect data published by ICE on its website. ICE further assured CFTC staff that its data-reporting problems would be fixed with the conversion to a new data-reporting format. CFTC staff informed ICE that continuing to report faulty data in the interim was unacceptable. Nevertheless, ICE continued to submit inaccurate and incomplete reports.

 

Further, ICE did not respond in a timely and satisfactory manner to inquiries from CFTC staff from multiple divisions about these data-reporting issues, including initial inquiries from the Division of Enforcement. Eventually, ICE did cooperate fully with the investigation and took effective corrective actions to address its reporting deficiencies. The CFTC has taken that cooperation and those actions into account in settling this matter.

 

In addition to imposing the $3 million civil monetary penalty, the CFTC ordered ICE to comply with undertakings to improve its regulatory reporting. For instance, ICE must create and maintain a new senior position of Chief Data Officer, who will have direct responsibility for systems and procedures relating to regulatory reporting, and ICE must hire and maintain at least three additional quality assurance staff who will be dedicated to regulatory reporting. ICE also must undertake certain data-reconciliation efforts, including reviewing certain prior data submissions to the CFTC to identify further violations of the charged CFTC Regulations and, beginning 120 days from the date of the Order, endeavoring to reconcile data provided to the CFTC with data published on its website, as well as with other data existing within ICE’s systems and its clearing providers’ systems. Additionally, ICE must correct any errors or omissions in data provided to the CFTC pursuant to Part 16 of the CFTC Regulations within one week of discovery or notification of the errors or omissions, or, in the event such corrections will take more than a week’s time, reporting to the CFTC why additional time will be necessary.

 

The CFTC Division of Enforcement staff members responsible for this matter are Margaret Aisenbrey, Allison Sizemore, Jeff Le Riche, and Charles Marvine, with assistance from the CFTC Division of Market Oversight staff Kelly Beck, Matthew Hunter, Harry Hild, and Anthony Saldukas and the CFTC Office of Data and Technology staff Regina Sanders, Margie Sweet, Rene Garcia, and Ed Wehner.

*  *  *

And don't do it again...

 

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Mon, 03/16/2015 - 15:26 | 5895142 Xibalba
Xibalba's picture

the only mopes are the ones still trading....

Mon, 03/16/2015 - 15:41 | 5895200 Pinto Currency
Pinto Currency's picture

 

 

ICE to administer daily LBMA Gold Fix:

http://forexmagnates.com/global-trading-venue-ice-becomes-new-administrator-daily-lbma-gold-price-fixing/

Much more reliable now.

Mon, 03/16/2015 - 15:47 | 5895222 Pladizow
Pladizow's picture

Fraud is Wall Street's business model!

Mon, 03/16/2015 - 19:29 | 5895936 philipat
philipat's picture

Um, actually Revenues are Sales NOT income. But the point remains the same.

Mon, 03/16/2015 - 23:47 | 5896854 chilli sauce
chilli sauce's picture

my roomate's step-mother makes $79 hourly on the laptop . She has been fired for 10 months but last month her pay was $18694 just working on the laptop for a few hours. see here... www.globe-report.com

Mon, 03/16/2015 - 15:26 | 5895143 Jack of All Trades
Jack of All Trades's picture

They got the Jamie Dimon treatment

Mon, 03/16/2015 - 15:27 | 5895144 JustObserving
JustObserving's picture

With expectations of over $4 billion in revenues for FY 2015, the $3 million fine represents just 0.75% of the exchange's income... that will teach them!!!

Please do your math again - that is 0.075%

Mon, 03/16/2015 - 15:32 | 5895163 highandwired
highandwired's picture

When "regulators" and bought and paid for, what else do you expect? 

Mon, 03/16/2015 - 17:35 | 5895628 Greenskeeper_Carl
Greenskeeper_Carl's picture

I love how this is punished. Cheat and aquire billions in profit, pay a small pittance to the fucking GOVERNMENT not the people you stole money from with your dishonest practices , and carry on. So, if I am the government, it is in my interests to allow this to happen as much as possible and never really penalize anyone, since the govt gets their money either way. Please, can this clown show of a market collapse already.

Mon, 03/16/2015 - 15:27 | 5895145 KnuckleDragger-X
KnuckleDragger-X's picture

You lied to us!!!! Now go to your room and watch porn and play video games for a few hours.....

Mon, 03/16/2015 - 15:28 | 5895146 i_call_you_my_base
i_call_you_my_base's picture

"The CFTC also noted that ICE Futures executives 'had the cash on them,' and promptly paid the fine."

Mon, 03/16/2015 - 15:28 | 5895147 SethDealer
SethDealer's picture

ICE is a piece of shit

Mon, 03/16/2015 - 15:28 | 5895148 NoDebt
NoDebt's picture

"ICE further assured CFTC staff that its data-reporting problems would be fixed with the conversion to a new data-reporting format. CFTC staff informed ICE that continuing to report faulty data in the interim was unacceptable. Nevertheless, ICE continued to submit inaccurate and incomplete reports."

Conspiracy theory stuff aside, paying the fine was probably a lot cheaper than fixing the reporting system.  When you get a pass that easy, you take it.

Mon, 03/16/2015 - 15:30 | 5895153 Racer
Racer's picture

"will be held accountable"

 

FFS, THAT is holding them accountable?

Mon, 03/16/2015 - 15:33 | 5895168 ebworthen
ebworthen's picture

Magnets under the roulette table, marked cards, pick-pockets, chip stealers, crooked dealers and croupiers, and security working for the house.

Sounds like a great place to put your money.

Mon, 03/16/2015 - 15:38 | 5895192 Fun Facts
Fun Facts's picture

This "financial system" reminds me of a Bahamas casino.

Mon, 03/16/2015 - 15:46 | 5895220 KnuckleDragger-X
KnuckleDragger-X's picture

But the women are better looking.....

Mon, 03/16/2015 - 15:33 | 5895173 Kirk2NCC1701
Mon, 03/16/2015 - 15:35 | 5895184 Mike Honcho
Mike Honcho's picture

Sure there will be lap dances for the lot of 'em at the next company outing.

Mon, 03/16/2015 - 15:36 | 5895187 Chippewa Partners
Chippewa Partners's picture

Bart.  Such a regulator!

Mon, 03/16/2015 - 15:41 | 5895191 Monetas
Monetas's picture

"Don't worry .... all ICE trading data .... and Hillbillary's Emails .... all of Lois Lerner's Emails .... are secure .... in a giant data storage facility in Utah .... your tax dollars at work !" .... NSA 

Mon, 03/16/2015 - 15:38 | 5895193 vote_libertaria...
vote_libertarian_party's picture

Are these the same type of 'reporting errors' that lead VXX to have 2x as many shares shorted as issued?

 

Just sayin'.

Mon, 03/16/2015 - 15:39 | 5895195 darteaus
darteaus's picture

Are they appealing this outrageous fine?!

Mon, 03/16/2015 - 15:39 | 5895196 Colonel Klink
Colonel Klink's picture

ICE and CFTC, worthless, corrupt organizations.  I believe we have RICO laws against such criminality.

Mon, 03/16/2015 - 15:54 | 5895250 ThroxxOfVron
ThroxxOfVron's picture

"I believe we have RICO laws against such criminality. "

Laws?

WTF are you talking about, Klink?!

Mon, 03/16/2015 - 16:29 | 5895396 Never One Roach
Never One Roach's picture

Steal a can of tuna fish from Wamart will get you a harsher penalty then Wall Street fraudsters get for billions.

Mon, 03/16/2015 - 16:38 | 5895420 pop goes the weasel
pop goes the weasel's picture

0.075%

Mon, 03/16/2015 - 19:07 | 5895872 SweetDoug
SweetDoug's picture

'

'

'

The question that should be asked is how much of that revenue earned was attributable to the malfeasance of the said data containing errors and omissions on every reporting day.

 



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Mon, 03/16/2015 - 19:20 | 5895911 Remington IV
Remington IV's picture

Futures traders , biggest front runners around

Do NOT follow this link or you will be banned from the site!