August 25, 2011
Chicago-Based Floor Broker Craig Taffel Pays $180,000 Civil Monetary Penalty to Settle Charges that He Acted as an Unregistered Futures Commission Merchant
Washington, DC — The U.S. Commodity Futures Trading Commission (CFTC) today issued an order filing and simultaneously settling charges against Craig A. Taffel, a registered floor broker located in Chicago, Ill., for acting as a futures commission merchant (FCM) without being registered.
The CFTC order imposes a $180,000 civil monetary penalty on Taffel and requires him to cease and desist from further violations of the Commodity Exchange Act, as alleged.
The CFTC order finds that from at least March 2008 to at least March 2010, Taffel acted as an FCM by allowing at least four individuals to place trades in Taffel’s personal trading account. The order finds that Taffel executed at least 141 trades in various grain futures for these four individuals, totaling at least 407 contracts. These individuals, according to the order, would instruct Taffel what trades they wanted made through instant messages, e-mails, or telephone calls, and he would execute these orders in his personal account for these individuals. The order further finds that Taffel assigned each of the individuals a sub-account under Taffel’s personal master account at the FCM and margined the individual’s trades with his master account, thereby extending credit to the four individuals. At least three of these four individuals worked for Taffel’s corporate customers and their job duties included relaying their employers’ futures orders to Taffel, the order finds.
The order finds that Taffel violated Section 4d(a)(1) of the Commodity Exchange Act by operating as an unregistered FCM when he accepted orders for the purchase and sale of futures and/or in connection with such acceptances of orders, accepted money, securities, or property (or extended credit in lieu thereof) to margin, guarantee, or secure any trades or contracts that resulted there from.
The CFTC thanks the CME Group for its assistance in this matter.
The CFTC Division of Enforcement staff members responsible for this case are Andrew Ridenour, Jessica Harris, Kenneth McCracken, Rick Glaser, and Richard Wagner.
Last Updated: August 25, 2011