The Commodity Futures Trading Commission (CFTC) issued a court order on Thursday against commodity trading firm Lansing Trade Group, LLC, which requires the company to pay a $3.4 million civil monetary penalty.
The CFTC charged the firm for the attempted price manipulation for wheat futures and options contracts traded on the Chicago Board of Trade (CBOT). Furthermore, Lansing was also charged with aiding and abetting the attempted manipulation of the cash price for yellow corn from Columbus, Ohio (Columbus Corn).
According to the Order, Lansing needs to strengthen its internal controls and procedures and implement new ones, to ensure the firm is compliant with anti-manipulation provisions regarding the Commodity Exchange Act (CEA) and CFTC Regulations.
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Commenting on the charges against Lansing, James McDonald, CFTC Director of Enforcement, said: “this Order shows the CFTC’s relentless commitment to preventing manipulation in our agricultural markets. The CFTC will continue to work with our law enforcement partners and other regulators to fight manipulation and to preserve market integrity.”
Lansing is a commodity trading and merchandising firm. It trades grains, oilseeds, feed ingredients and energy products. In addition, Lansing’s traders hedge their physical grain trading activity and take speculative positions by trading related commodity futures, including CBOT wheat futures and options contracts. The company has offices across North America and the United Kingdom.
CME Group Inquiry
The investigation into Lansing was conducted in conjunction with a related inquiry by the CME Group Inc., a US financial market company that operates an options and futures exchange. On Thursday, the CME Group issued a Notice of Disciplinary Action (NDA) against Lansing, and the commodities firm agreed to pay a separate fine of $3.15 million.
According to the statement, the regulator took the civil monetary penalty imposed by the CME Group into account when charging Lansing the $3.4 million fine. The CFTC has thanked the CME Group for its assistance.