International derivatives marketplace CME Group has issued a notice of disciplinary action against Wedbush Securities Inc.

Pursuant to an offer of settlement, in which Wedbush Securities Inc. neither admitted or denied Rule violations, a Panel of the CME Business Conduct Committee found that on February 24, 2022, Wedbush’s back-office accounting platform failed to maintain records of cleared trades after its settlement platform reached an upper limit of traded contracts due to extremely high trading volume.

As a result, from that date through March 2022, Wedbush: (1) submitted inaccurate large trader position reports to the Exchange; and (2) failed to submit position change data to the Clearing House in a timely manner.

These inaccurate and untimely reports included positions in various contract months of Live Cattle futures and options on futures (“F&O”), Feeder Cattle F&O, Australian Dollar futures, Brazilian Real futures, Bitcoin F&O, Canadian Dollar futures, One-Year and Three-Year Mid-Curve Eurodollar options, E-mini Euro FX futures, Euro FX futures, Eurodollar F&O, E-mini S&P 500 Index F&O, E-mini S&P 500 Index end-of-month and weekly options, Ether futures, Micro E-mini S&P 500 Index weekly options, Japanese Yen futures, Lumber F&O, Lean Hog F&O, Micro E-mini Russell 2000 Index futures, Micro Australian Dollar/U.S. Dollar futures, Micro British Pound/U.S. Dollar futures, Micro Euro/U.S. Dollar futures, Micro Bitcoin futures, Micro Canadian Dollar/U.S. Dollar futures, Micro E- mini S&P 500 Index F&O, Micro Ether futures, Micro Japanese Yen/U.S. Dollar futures, Micro E-mini Nasdaq-100 Index F&O, Mexican Peso futures, Micro E- mini Nasdaq-100 end-of-month and weekly options, Yen Denominated Nikkei Stock Average futures, New Zealand Dollar futures, Nikkei Stock Average futures, E-mini Nasdaq-100 F&O, E-mini Nasdaq-100 end-of-month and weekly options, E-mini Russell 2000 weekly options, South African Rand futures, Euro/British Pound futures, E-mini Russell 2000 Index futures, Russian Ruble futures, S&P 500 Annual Dividend Index futures, and One-Month and Three- Month SOFR futures.

The Panel also found that on multiple occasions from March 2022 to April 2022, Wedbush failed to respond to requests from duly authorized Exchange staff for information pertaining to position data in a timely manner.

The Panel found that as a result of the foregoing, Wedbush violated CME Rules 561, 811, and 432.L.3.

In accordance with the settlement offer, the Panel ordered Wedbush to pay a fine in the amount of $175,000 in connection with this case and companion cases NYMEX 22-1591-BC, COMEX 22-1591-BC, and CBOT 22-1591-BC ($40,000 allocated to CME).