Former Delta Fuel Trader Banned, Fined
June 13 2016 - 5:51PM
Dow Jones News
By Christian Berthelsen
A former Delta Air Lines Inc. fuel trader was banned from
trading and fined $300,000 by the CME Group Inc., which said he
made more than $2.8 million in personal profits by front-running
trades he placed for the airline.
Jon Ruggles, who led Delta's fuel hedging program, used two
accounts in his wife's name more than 80 times between April and
December 2012 to place trades that would profit from his employer's
market positions, according to a disciplinary notice published by
CME on Monday. The firm owns the New York Mercantile Exchange where
oil and energy derivatives are traded.
CME also ordered Mr. Ruggles to hand over the $2.8 million the
firm alleges he made from these transactions. .
"Ruggles repeatedly abused his trading discretion given to him
by his employer for personal gain," the CME notice said.
Mr. Ruggles and his wife, Ivonne, also face a permanent trading
ban on CME Group exchanges, according to the CME notice. The
disciplinary notice said they declined, through lawyers, to answer
exchange regulators' questions about the matter.
Mr. Ruggles didn't return a message seeking comment.
The findings said that while the personal trades were placed
with Ivonne Ruggles's identification tag, the electronic addresses
associated with the trades led back to the offices of Mr. Ruggles's
employer. The notice said the total gains for the couple from the
scheme amounted to more than $3.3 million, but that Mr. Ruggles
wasn't subject to CME jurisdiction for a portion of the time in
question.
The notice didn't specify in which markets Mr. Ruggles placed
the trades, or identify his employer by name. Mr. Ruggles left
Delta in December 2012.
The U.S. Commodity Futures Trading Commission has launched an
investigation into the trades, according to a person familiar with
the matter. The CME's disciplinary notice against him said the
exchange would waive any disgorgement amount that is similarly
required as part of a settlement with the CFTC.
Write to Christian Berthelsen at
christian.berthelsen@wsj.com
(END) Dow Jones Newswires
June 13, 2016 18:36 ET (22:36 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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