Grand International Futures Is Fined $500,000 By CME For ID Rule Violations

Grand International Futures Company Limited has been fined $500,000 by the Chicago Mercantile Exchange (CME) as a disciplinary action for breaking the trading venue's regulations regarding client identity.

The CME has fined Grand International Futures.

The compensation offer was made after a panel of the Chicago-based derivatives exchange giant's corporate conduct committee discovered various infractions in Grand's methods of providing trading services, according to the official release.

Every client of a clearing member who uses CME's systems must be uniquely identified. “To access Globex, each person must need a unique operator ID. ”In no instance may a person enter or authorize an individual to place an order using an operator ID other than the individual's own unique operator ID, the CME warned.

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Grand, on the other hand, failed to have suitable policies and processes in place for the development, maintenance, and monitoring of operator identifications for its clients from 3 February 2020 to 17 February 2021. The corporation allowed its clients to generate their operating identifications with the help of a third-party software supplier, who was unable to identify the customer who utilized the operator identifications. Furthermore, the system permitted several clients to use the same operator identifier to place orders.

“The Panel discovered that by permitting its clients to frequently establish operator IDs via a third-party software provider, Grand lost its capacity to identify and monitor those customers who transmitted communications to the Exchange using these operator IDs,” the CME stated.

The CME Group is a major US derivatives trading venue.

CME is one of the United States two main derivatives exchange venues. Its sales for the third quarter of the current fiscal year climbed by 11% to $1.11 billion, with a net income of $719 million compared to $574 million the previous year. The quarterly numbers were boosted by a 26% increase in trading activity on the platform.

Meanwhile, CME is working to expand its product offerings. It launched retail event contracts, which are trading products similar to binary options, in September.

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