The Commodity Futures Trading Commission on Wednesday sanctioned FirstRand Bank, Ltd., a South African financial services company, for executing unlawful prearranged, noncompetitive futures trades on the Chicago Board of Trade as part of a hedging strategy. FirstRand and another company alleged executed this strategy to hedge their exposure to related futures contracts on the Johannesburg Stock Exchange's SAFEX Commodity Derivatives Market, which, the bank said, permits prearranged trades between market makers in inward listed futures contracts. "FirstRand mistakenly believed that such prearranged trades were permissible on the [Chicago Mercantile Exchange, of which the CBOT is a subsidiary] as well. Upon being alerted to concerns about its prearranged trading on the CME, FirstRand immediately ceased such trading, and it has cooperated fully during this investigation," the CFTC said in an order. The CFTC accepted an offer by FirstRand in which it consented, without admitting or
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