NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

TAE HYUNG KIM

EXCHANGE RULES: 432. General Offenses

It shall be an offense:

Q. to commit an act which is detrimental to the interest or welfare of the Exchange or to engage in any conduct which tends to impair the dignity or good name of the Exchange;

W. For any party to fail to diligently supervise its employees and agents in the conduct of their business relating to the Exchange.

FINDINGS:

Pursuant to an offer of settlement Tae Hyung Kim (“Kim”) presented at a hearing on May 24, 2017, in which Kim neither admitted nor denied the rule violations upon which the penalty is based, a Panel of the NYMEX Business Conduct Committee (“BCC Panel”) found that during the time period of July 2015 through March 2016, Kim was operating market-making and market-taking automated trading systems (“ATS”) simultaneously during the pre-opening period that entered and cancelled a number of orders in the E-mini Crude Oil and Natural Gas futures contracts. The market-taking strategy should not have been running in the pre-opening period and the orders it generated were not intended to be entered. Due to Kim’s failure to properly supervise these automated trading strategies, he was not aware of the excessive messaging created by the running of both strategies during the pre-opening period which resulted in flickering price quotes.

The Panel found that as a result of the foregoing, Kim violated Rule 432.Q. and 432.W.

PENALTY:

In accordance with the settlement offer, the BCC Panel ordered Kim to: 1) pay a fine of $25,000 and 2) serve a five (5) business day suspension of any access to any CME Group Inc. trading floor and of direct and indirect access to all electronic trading and clearing platforms owned or controlled by CME Group Inc., including CME Globex. The suspension will run from May 26, 2017 through June 2, 2017, inclusive.