The views expressed in this document are solely the views of the author and not Martindale-Hubbell. This document is intended for informational purposes only and is not legal advice or a substitute for consultation with a licensed legal professional in a particular case or circumstance.

By clicking on the "Submit" button, you agree to the Terms of Use, Supplemental Terms and Privacy Policy.

Consent is not a condition of purchase. You should not send any sensitive or confidential information through this site.

Emails sent through this site do not create an attorney-client relationship and may not be treated as privileged or confidential.

ICE Futures US: Wash Trades FAQ, February » Neurensic

The lawyer or law firm you are contacting is not required to, and may choose not to, accept you as a client. The Internet is not necessarily secure and emails sent though this site could be intercepted or read by third parties. All information received will always remain confidential.

You will be contacted once your message has been reviewed. Please see summary of your contact submission below. A copy of your submission has been sent to the email address provided.

HOME LEGAL LIBRARY ARTICLES. New ICE Futures U.

Wash Trade FAQ April 5, Authors: This ICE FAQ replaces a ICE Wash Trade FAQ and provides additional guidance to market participants on trades that may constitute wash trades. The ICE FAQ also highlights intermediary and third party obligations not to accept orders for trades if it knows or should know that they are wash trades. A market participant also includes any individual or firm that is involved with the placement, negotiation, or execution of a transaction such as a floor, firm or voice broker.

ICE futures U.S. fines member US $, for problematic block trades - Lexology

What is a Wash Trade? Standard for Wash Trade Liability and Evidence of Intent Although there is an explicit intent element for wash trades, the ICE FAQ explains that any market participant who knows or should know that a transaction they initiate, place, accept, or accommodate will result in a wash trade is in violation of ICE exchange Rule 4. The ICE FAQ also reiterates that, in accordance to Exchange Rule 4.

New ICE Futures U.S. Wash Trade FAQ | yvajotefihy.web.fc2.com

The fact that the trade was not prearranged and was executed competitively on the exchange will not necessarily preclude the parties from facing potential liability. Accepting Simultaneous Buy and Sell Orders The ICE FAQ re-affirms that intermediaries may be liable for executing orders that result in wash trades.

According to ICE, when an intermediary receives simultaneous buy and sell orders and determines the orders are for the benefit of the same Principal, or the intermediary cannot determine whether the trades are for the benefit of the same Principal, the intermediary should not accept the orders. If the intermediary nevertheless accepts simultaneous buy and sell orders without knowledge of improper customer intent to engage in a wash trade, the ICE FAQ provides that the intermediary can mitigate regulatory liability for accepting a wash trade by taking steps to ensure that the orders do not execute opposite each other.

For example, the intermediary can enter and execute one order prior to the entry and execution of the second order. However, these steps may not represent a practical solution because an intermediary may still be liable if ICE determines the trade was a wash trade.

The ICE FAQ also highlights recordkeeping obligations for intermediaries that accept simultaneous buy and sell orders for the same principal. Specifically, the intermediary receiving the orders must maintain records of such orders e.

ICE Futures US: Wash Trades FAQ, February » Neurensic

Algorithmic proprietary traders are required to use STPF to prevent wash trades; other market participants may choose to take advantage of it. Although the traders may initiate the orders independently, the orders may coincidentally match for the accounts of the same Principal. ICE also recognizes that a single ATS, or multiple ATSs controlled by the same individual, may submit buy and sell orders that inadvertently match for the accounts of the same Principal.

The ICE FAQ addresses the following three scenarios involving unintentional wash trades: If traders from independent business units submit buy and sell orders that coincidentally match for the accounts of the same Principal, ICE does not consider the resulting trade a wash trade provided: Different Traders for the Same Principal.

Single ATS or Various ATSs Controlled by the Same Individual. That said, a block trade or EFRP transaction between accounts of affiliated parties does not violate the ICE wash trade prohibition if the trade is consistent with the ICE requirements set forth below.

A block trade between affiliated accounts does not constitute a wash sale where: An EFRP transaction between affiliated accounts does not constitute a wash sale where the accounts are: Yes, I am an Attorney No.

BACK TO PREVIOUS SCREEN. Thank you All information received will always remain confidential. Preferred method of contact:.

About Us About Martindale-Hubbell Martindale-Hubbell Ratings and Reviews Contact Us. Featured Services Martindale-Hubbell Profiles Martindale-Hubbell Law Firm Websites Lead Generation Conversion Tools Martindale-Hubbell Ratings and Reviews Legal Library. The information provided on this site is not legal advice, does not constitute a lawyer referral service, and no attorney-client or confidential relationship is or should be formed by the use of this site. The attorney listings on the site are paid attorney advertisements.