Release Number 7404-16
July 11, 2016
CFTC Orders Golden Agri International Pte Ltd. to Pay $150,000 for Failing to Report Cash Positions
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today issued an Order filing and simultaneously settling charges against Golden Agri International Pte Ltd. (Golden Agri), an entity that operates as a processor and trader of crude palm oil, which it hedges with soybean oil futures contracts, for failing to file CFTC Form 204 Reports as required by CFTC Regulation 19.01. Golden Agri is a private limited company formed in Singapore and is a wholly-owned subsidiary of Golden Agri-Resources Ltd. located in Indonesia.
The CFTC Order requires Golden Agri to pay a $150,000 civil monetary penalty, to cease and desist from committing further violations of CFTC Regulation 19.01, and to undertake to adopt, maintain, and implement internal controls that are reasonably designed to ensure that it complies fully with Regulation 19.01.
The Order states that CFTC Regulation 19.00(a)(1) requires that persons holding or controlling futures and options positions in certain agricultural commodities that are reportable, and any part of which constitute bona fide hedging positions, must file CFTC Form 204 reports showing the composition of the fixed price cash position of each such commodity hedged (including wheat, corn, oats, soybeans, soybean oil and soybean meal). According to the Order, a purpose of the Form 204 report is to check compliance with speculative position limits by ensuring that filers classify their futures positions as hedging cash positions that are actually owned or controlled.
The Order finds that Golden Agri held or controlled soybean oil futures positions that were reportable and, based on records provided by Golden Agri, constituted bona fide hedging positions; therefore, Golden Agri was required to file 204 Reports within 3 business days from the last Friday of the month. As set forth in the Order, Golden Agri, however, failed to file five CFTC 204 reports as required by CFTC Regulations. As noted in the Order, four CFTC Form 204 reports were subsequently filed with the CFTC 15 months after they were required to be filed and only after CFTC staff contacted Golden Agri regarding its failure to file such Reports, and a fifth report was subsequently filed with the CFTC five months after it was required to be filed.
Consistent with this filing, the CFTC’s Division of Market Oversight has issued an advisory regarding the obligation of market participants to file CFTC Form 204 Reports (see CFTC Staff Advisory No.13-42, Obligation of Reportable Market Participants to File CFTC Form 204 Reports, which is linked in CFTC Press Release 6639-13, July 8, 2013).
The Division of Market Oversight staff members responsible for this matter are Matthew Hunter, Eugene Kunda, and David Amato, Jerry Lavin, and Adam Charnisky.
The Division of Enforcement staff members responsible for this action are Jordon Grimm, Janine Gargiulo, Trevor Kokal, Steve Ringer, Lenel Hickson, Jr., and Manal M. Sultan.
Last Updated: July 11, 2016