International derivatives marketplace CME Group has posted a notice of disciplinary action against Telesto Sciences, LLC.

Pursuant to an offer of settlement, in which Telesto Sciences, LLC neither admitted nor denied the rule violation or factual findings upon which the penalty is based, a Panel of the NYMEX Business Conduct Committee found that from February 28, 2024, to September 11, 2024, an ATS controlled and monitored by Telesto, a proprietary trading firm located in the United States, engaged in a pattern of repeatedly retransmitting network packets prior to the arrival of the Pre-Open security status message in Crude Oil and Natural Gas TAS (Trading at Settlement) futures.

Telesto sent high counts of network packet retransmissions in non-TAS products, sent packet retransmissions with larger than normal packet sizes, and generated numerous symbol errors from its messaging to the Exchange.

Telesto was unaware of its unintended, excessive messaging, the symbol errors its system introduced into its packets, and the aberrant packet sizes prior to the TAS Pre-Open.

Additionally, after being alerted to this activity and attempting to fix the packet content issue, Telesto’s ATS continued to re-transmit smaller network packets accompanied by symbol errors during the trading day in non-TAS products.

The Panel found that as a result of the foregoing, Telesto violated NYMEX Rule 432.W.

In accordance with the settlement offer, the Panel ordered Telesto to pay a $30,000 fine.