NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

MILLENNIUM MANAGEMENT LLC

EXCHANGE RULES:

Rule 432 – GENERAL OFFENSES (in part)

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 of good name of the Exchange;

Rule 432 – GENERAL OFFENSES (in part)

It shall be an offense:

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 in which Millennium Management LLC (“Millennium”) neither admitted nor denied the Rule violations or factual findings upon which the penalty is based, on December 15, 2022, a Panel of the NYMEX Business Conduct Committee (“Panel”) found that on June 7, 2019, a quantitative trading strategy deployed by Millennium issued an instruction for a Millennium trader to buy July 2019 Palladium futures contracts based, in part, on incorrect assumptions regarding liquidity in the market. Thus, on June 10, 2019, the Millennium trader placed an order to purchase 76 Palladium July 2019 contracts. However, the absence of sufficient liquidity in the July 2019 Palladium contract resulted in price aberrations and a 362-tick price movement. Approximately two-and-a-half hours later and after purchasing 55 July 2019 Palladium contracts, Millennium identified the price movements and undesirable fill prices in the July 2019 contract. Millennium then cancelled the balance of its July 2019 Palladium order and sought to exit its position by entering an order to sell 55 Jul19-Sep19 Palladium spread contracts. The Jul19-Sep19 Palladium spread market also lacked sufficient liquidity, and Millennium’s sell order therefore caused additional price aberrations, triggering a Dynamic Circuit Breaker event and a two-minute trading halt.

The Panel further found that Millennium failed to diligently supervise its employees in a manner sufficient to ensure compliance with relevant Exchange Rules and Market Regulation Advisory Notices.

The Panel found that as a result of the foregoing, Millennium violated NYMEX Rules 432.Q. and 432.W.

PENALTY:

In accordance with the settlement offer, the Panel ordered Millennium to pay a $90,000 fine.