Release Number 8778-23
CFTC Orders StoneX Markets LLC to Pay $650,000 for Violations of Swap Business Conduct Standards
Swap Dealer Admits It Failed to Disclose Pre-Trade Mid-Market Marks and Failed to Diligently Supervise its Compliance Process
September 20, 2023
Washington, D.C. — The Commodity Futures Trading Commission today issued an order simultaneously filing and settling charges against StoneX Markets LLC (StoneX), a registered swap dealer, for violations of the CFTC’s Business Conduct Standards applicable to swap dealers. Specifically, the CFTC found that StoneX failed to disclose thousands of Pre-Trade Mid-Market Marks (PTMMM), in violation of CFTC Regulation 23.431, and failed to diligently supervise its PTMMM compliance process, in violation of CFTC Regulation 23.602.
The order imposes a $650,000 civil monetary penalty and requires StoneX to complete its remediation and submit reports to the Division of Enforcement on its compliance.
StoneX admits and the order finds that for numerous transactions between 2016 and 2022, StoneX failed to diligently supervise its PTMMM disclosure process, resulting in StoneX’s failure to comply with PTMMM disclosure requirements for thousands of swap transactions. Specifically, StoneX failed to implement procedures to ensure that its PTMMMs were accurate (i.e., consistent with StoneX’s internal pricing methodologies), failed to adequately train and monitor its associated persons regarding PTMMM disclosure requirements, and failed to timely provide PTMMMs to counterparties.
The Division of Enforcement staff responsible for this case are Daniel C. Jordan, Rick Glaser, and former staff member Amanda Burks.