International derivatives marketplace CME Group has fined Banco do Brasil, S.A. for alleged violations of CBOT rules.

Pursuant to an offer of settlement in which Banco do Brasil, S.A. neither admitted nor denied the rule violations or factual findings upon which the penalty is based, a Panel of the Chicago Board of Trade (CBOT) Business Conduct Committee found that on February 9, 2024, traders employed by Banco do Brasil, a state-owned bank located in Brazil, bought and sold March 2024 Soybean TAS futures at the same price for the same account.

The traders entered their orders opposite each other in order to close positions that served as hedges for expiring options and forward contracts positions. The Banco do Brasil traders knew or reasonably should have known that the purpose of the orders was to avoid taking a bona fide market position exposed to market risk.

The Panel also found that Banco do Brasil failed to diligently supervise its employees by not properly advising and training them as to Exchange rules pertaining to wash trades in a manner sufficient to ensure compliance with the same.

The Panel thereby concluded that Banco do Brasil violated CBOT Rules 534 and 432.W.

In accordance with the settlement offer, the Panel ordered Banco do Brasil to pay a $35,000 fine.