NYMEX and two former employees to pay $4 million for disclosing trading information

The US Commodity Futures Trading Commission (CFTC) announced the US Court imposed a penalty of $4 million on New York Mercantile Exchange (NYMEX) and former employees William Byrnes and Christopher Curtin for disclosure of non-public information.

From 2008 to 2010 when Byrnes and Curtin were employees of NYMEX, disclosed material non-public information obtained through special access. They revealed to commodities broker and defendant Ron Eibschutz the identities of counterparties to crude oil options and natural gas futures trades, trade details such as price and volume, and other confidential information.

Byrnes and Curtin were permanently banned form trading commodity interests. The court also imposed a $4 million civil monetary penalty on all three defendants with the liability of Byrnes and Curtin capped, respectively, at $300,000 and $200,000.

CFTC penalty

This is the first time the CFTC has charged and exchange with violations of these regulations and disclosure of material non-public information.

Director of Enforcement James McDonald commented:

Today’s settlement sends a strong message that the CFTC will work tirelessly to protect our market participants against unlawful disclosures of their confidential information to ensure that the fairness and reliability of our markets are not compromised. Like any other employer, commodity exchanges are responsible for violations of the CEA or CFTC regulations by their officials, employees, and agents within the scope of their employment or office.

The CFTC’s litigation against Eibschutz for his role continues.

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