Noble Americas pays $130,000 penalty for NYMEX wash trades

03 May 2010 20:19  [Source: ICIS news]

HOUSTON (ICIS news)--Trading firm Noble Americas is paying a penalty of $130,000 (€97,500) to settle charges that it undertook so-called wash sales in NYMEX heating oil and gasoline futures in a fourth-month period in 2007, a US regulator said on Monday.

The Commodity Futures Trading Commission (CFTC) said Noble Americas, which is a subsidiary of Hong Kong's Noble Group, simultaneously bought and sold the same contract and same quantity of the products, at the same or similar prices.

Both futures contracts and exchange-for-physical (EFP) trades were involved, the regulator said.  

"In certain instances, Noble Americas prearranged the execution of these trades on NYMEX through a futures commission merchant," the CFTC said.

"In other instances, Noble Americas used EFP transactions to transfer positions from one Noble Americas trader to another," it said. 

The firm intended to negate market risk and price competition, the regulator said.

In recent years, the CFTC has imposed financial penalties to settle dozens of cases involving trading irregularities, amid pressure from Congress and the chemical industry in particular to crack down on market manipulation.

($1 = €0.75)

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