International derivatives marketplace CME Group has posted a notice of disciplinary action against Gain Global Markets Bermuda Ltd., a wholly owned subsidiary of StoneX Group.

Pursuant to an offer of settlement in which Gain Global neither admitted nor denied the rule violations upon which the penalty is based, a Panel of the New York Mercantile Exchange Business Conduct Committee (“Panel”) found that on several occasions between April 2022, and August 2022, as well as in April 2024, Gain Global engaged in pre-hedging activity in various Crude Oil, NY Harbor ULSD, RBOB, and Platinum futures contracts.

Specifically, in each instance, another wholly owned subsidiary of StoneX Group would receive a solicitation from a counterparty to participate in a block trade.

The StoneX Group Subsidiary sent the counterparty to Gain Global for the block trade but on several occasions did not provide all required disclosures concerning its role. Prior to Gain Global consummating the block trade with the counterparty, Gain Global executed trades on Globex in the same product on the opposite side of the market of the counterparty’s block trade.

By executing the hedge transaction prior to consummating the block trade with the counterparty, Gain Global realized a profit on the subsequent execution opposite the counterparty.

The Panel concluded that Gain Global thereby violated NYMEX Rule 526.

In accordance with the settlement offer, the Panel ordered Gain Global to pay a fine in the amount of $100,000 and to disgorge profits in the amount of $449,910.