ICE Futures US has announced settlement of charges against Starfuels, Inc.
On February 21, 2024, a subcommittee of the Exchange’s Business Conduct Committee (BCC) determined that in several instances from May 2021 through September 2022 (Relevant Period), Starfuels, Inc. may have violated Exchange Rule 4.07(a)(ii)(A) by failing to comply with the private negotiation requirement for certain block trades submitted to the Exchange. Specifically, for each of the block trades, Starfuels received, negotiated, and consummated the block trade earlier in the day for a price not known until later in the trading day (e.g., closing price).
Once the price was established and known, Starfuels failed to confirm the price with the parties and whether they were still willing to enter into the trade.
The BCC further determined that in several instances during the Relevant Period Starfuels may have violated the following Exchange rules for certain block trades: 4.07(c) by failing submit to the Exchange the correct User ID and company name of the market participant that executed the trade; legacy 6.08(b)(i) by failing to comply with order ticket requirements; and 6.07(a)(iii) by failing to comply with general recordkeeping requirements.
Lastly, the BCC determined that, during the Relevant Period, Starfuels may have also violated Rule 4.01(a) by failing to diligently supervise the block trade activities of its employees and Rule 4.01(b) by failing to establish, administer, and enforce supervisory systems, policies and procedures, which are reasonably designed to achieve compliance with Exchange Rules.
In accordance with the terms of settlement, in which Starfuels neither admitted nor denied the alleged rule violations, Starfuels agreed to pay a monetary penalty of $110,000.
