ICE Futures bans Always Trade Sensibly Limited for layering orders
ICE Futures today announces that it has taken disciplinary action against Always Trade Sensibly Limited (ATSL) over the firm’s violations of a number of rules.
A Hearing Panel of the Exchange’s Business Conduct Committee found that, between July 5 and July 12, 2017, ATSL violated Exchange Rules 4.02(l)(1)(A), 4.02(l)(1)(C), 4.02(l)(2), and 4.04.
The Panel found that during the relevant period, ATSL, through the actions of one of its traders, engaged in a pattern of layering orders for several accounts at various price levels on one side of the orderbook while trading small-quantity orders on the opposite side. Instead of entering orders with the intent to trade, ATSL was found to have entered the layered orders on one side of the orderbook to create false depth, put pressure on the market, and mislead market participants into trading against, or moving the market closer to, its opposing small-quantity orders.
The products involved are MSCI Emerging Markets Index Futures and Russell 2000 Index Mini Futures.
In particular, the rules that ATSL violated include:
- Rule 4.02(l)(1)(A) – Trade Practice Violations
In connection with the placement of any order or execution of any Transaction, it shall be a violation of the Rules for any Person to . . . [enter] an order or market message, or cause an order or market message to be entered, with the intent to cancel the order before execution, or modify the order to avoid execution.
- Rule 4.02(l)(1)(C) – Trade Practice Violations
In connection with the placement of any order or execution of any Transaction, it shall be a violation of the Rules for any Person to . . . [enter] an order or market message, or cause an order or market message to be entered, with the intent to disrupt the orderly conduct of trading, the fair execution of transactions or mislead other market participants.
- Rule 4.02(l)(2) – Trade Practice Violations
In connection with the placement of any order or execution of any Transaction, it shall be a violation of the Rules for any Person to . . . knowingly [enter] any bid or offer for the purpose of making a market price which does not reflect the true state of the market, or knowingly [enter], or causing to be entered, bids or offers other than in good faith for the purpose of executing bona fide Transactions.
- Rule 4.04 – Conduct Detrimental to the Exchange
It shall be a violation of the Rules for any Person to fail to conform to, the Rules or the procedures of the Exchange or the Clearing Organization, or to engage in conduct or practices inconsistent with just and equitable principles of trade or conduct detrimental to the best interests of the Exchange.
Due to the violations, ATSL is permanently banned from access to all ICE Futures U.S. electronic trading platforms, including ICE Block. The effective date of the disciplinary action is March 2, 2021.