September 9, 2013
Washington, DC – The Commodity Futures Trading Commission (Commission) has notified the Minneapolis Grain Exchange, Inc. (MGEX) of the results of a rule enforcement review completed by the Commission’s Division of Market Oversight (Division). The review covered the target period from June 1, 2011 to May 31, 2012. The Division assessed MGEX’s compliance with pre-Dodd-Frank Act Core Principles 10 and 17 and post-Dodd-Frank Act Core Principles 10 and 18 (audit trail program); pre- and post-Dodd-Frank Act Core Principles 2 and 12 (trade practice surveillance program); pre-Dodd-Frank Act Core Principle 2 and post-Dodd-Frank Act Core Principle 13 (disciplinary program); and pre-Dodd-Frank Act Core Principle 13 and post-Dodd-Frank Act Core Principle 14 (dispute resolution program).
The Division found that MGEX maintains fair and equitable dispute resolution procedures. Since there were no arbitrations at MGEX during the target period, the Division was unable to evaluate the adequacy of MGEX’s dispute resolution program. The Division also found that MGEX generally maintains adequate trade practice surveillance and disciplinary programs and adequate audit trail procedures. However, the Division identified some areas in which MGEX needs to make improvements and recommended that MGEX (1) conduct electronic and open outcry audit trail and recordkeeping reviews at least annually, as well as timely follow-up reviews within six months when necessary; (2) revise and publish its summary fine schedule in the Exchange rulebook beginning with an initial summary fine amount of at least $1,000; and (3) take certain measures to ensure that trade practice investigations are consistently thorough and well-documented.
Lastly, the Division found that MGEX maintained sufficient qualified personnel to fulfill its self-regulatory responsibilities as of the end of the target period.
Copies of the report are available from the Commission’s Office of Public Affairs, Three Lafayette Centre, 1155 21st Street N.W., Washington, DC 20581, 202-418-5080, or by accessing the Commission’s website at www.cftc.gov.
Last Updated: September 9, 2013