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Enron Mail |
Notice to Members No. 01-174
May 22, 2001 REMINDER =01) SECOND NOTICE To: All NYMEX Division Members All COMEX Division Members From: Neal Wolkoff, Executive Vice President Re: -Changes to Audit Trail Summary Fine Structure-NYMEX & COMEX Divisions -Incorporation of Spreads into One Minute Trade Time Submission for NYMEX Modification of =01&Clear-out Period=018 The Board of Directors has approved modifications to the fine structure for= =20 one-minute trade time submission for both NYMEX and COMEX divisions.=20 Presently members falling below 80% timely submission per month are issued= =20 escalating warning letters and fines unless and until they clear out their= =20 record by being in compliance for six consecutive months. After six months= ,=20 the member returns to a =01&warning letter=018 level. Effective immediatel= y, this=20 =01&clear-out period=018 is reduced from six months to four months. One-mi= nute=20 trade timing statistics for the month ending April 30, 2001 will reflect th= is=20 modification. Implementation of One-Minute Trade-Time Classes The Board also accepted the recommendation of the Compliance Review Committ= ee=20 and Floor Committee to adopt a training program for members facing one-minu= te=20 trade time fines on the NYMEX division. The purpose of the program is to= =20 improve Exchange trade submission timing through member education by=20 identifying individual issues, tailoring individual solutions and statistic= al=20 follow-up. Training will be conducted on Thursday, June 14, Tuesday, July= =20 10, and Wednesday, August 15, 2001 by a team comprised of Committee Members= =20 and Compliance Staff with the assistance of the Training and Education=20 Committee. Details on class location and sign-up procedures will follow. As incentive, any member attending any one class will be allowed to =01&do = over=018=20 up to two subsequent months in which their trade time rates are between 70%= =20 and 79%. The member will still have to complete four violation free months= =20 before his record is =01&cleared out=018 but he may take up to six months t= o do=20 so. Members may take one class per year. Audit Trail Classes ? Purpose=01*to reduce number of members falling below the 80% standard for= pit=20 card submission and to facilitate the return of members to a =01&warning le= tter=018=20 level. ? Members who have received a warning letter or a fine for pit card=20 violations may: _ Attend an audit trail class, to be offered in June, July and August of=20 2001, with future dates to be determined by the Floor Committee/Compliance= =20 Review Committee. The class will be an intensive discussion of pit card=20 problems and pitfalls. Materials will focus on how the audit trail works a= nd=20 successful strategies for achieving a passing grade. Members attending cla= ss=20 will be required to analyze their own trading style in light of the materia= l=20 presented and pinpoint areas which they need to improve. Members will also= =20 be required to outline a plan of attack to address raising their pit card= =20 performance rates. Each plan will be discussed with the group and members= =20 will receive feedback from Floor and Compliance Review Committee Members, a= nd=20 Compliance and Floor Department Staff. Members attending classes are=20 strongly encouraged to bring their clerks with them! _ Upon completion of the class, members will be allowed to =01&do over=018 = up to=20 two subsequent months in which they received the warning or fine for=20 substandard trade time rates between 70% and 79%, on their way to achieving= =20 four months clear. No fine or warning letter will be issued for a =01&do o= ver=018=20 month but the month will not count as a passing month. A member who falls= =20 below 70% will receive a fine or warning letter. _ The benefit to the member will be that the month that would have counted = as=20 a failing month will not count at all, as long as the member achieved at=20 least a 70% rate. Members still need four problem free months to return to= a=20 warning letter stage from a fine stage. A member who has been problem free= =20 for 3 months would benefit by =01&doing over=018 a fourth (and possibly a f= ifth)=20 failing month, thus having the opportunity to return to a warning letter=20 phase despite intervening failing months. A member who falls below 70%=20 before achieving four problem free months will receive a fine or a warning= =20 letter, as appropriate. The member can still use a second =01&do over=018 = month as=20 long as he meets all criteria. _ Staff will follow up with members attending the classes. Members will=20 receive a breakdown of their most recent audit trail fine. They will also = be=20 invited to discuss their percentages with staff one-on-one. Further, staff= =20 will supply daily or weekly statistics to any member by e-mail upon request= . _ Members are eligible for only one class per year. A member must take a= =20 class before being given the benefits listed herein. Classes will be offer= ed=20 on June 14, July 10 and August 15, 2001, and the program will apply to the= =20 next full month of audit trail results. The Compliance Review Committee an= d=20 the Floor Committee will evaluate the results of this program before decidi= ng=20 whether to extend this program into 2002. Incorporation of Spreads into One-Minute Trade Time =01&Pit Card=018 Statistics for NYMEX Division Present one-minute trade time =01&pit card=018 statistics do not include sp= read=20 times. During the most recent NYMEX Rule Enforcement Review--the CFTC audi= t=20 of the Exchange=01,s Compliance programs and procedures--the CFTC recommend= ed=20 that the NYMEX Division incorporate spread trades into the one-minute time= =20 statistics. The CFTC has made this recommendation in the past and the=20 Exchange has committed to respond to it. The COMEX Division one-minute trad= e=20 time statistics already include spreads. NYMEX Division Members should note that intra-commodity spread trades will = be=20 incorporated into pit card one-minute trade time accuracy rates after a=20 =01&phase in=018 process of approximately 90 days. In order to avoid subst= andard=20 percentages once spreads are incorporated, members must make sure that thei= r=20 spread prints are price reported in order to ensure that the Price Change= =20 Register for spreads is accurate. If a spread print is not reported, you= =20 will not be credited with timely submission of pit cards, even if you throw= =20 the trade into the pit in a timely manner. Pit card statistics for outright trades are presently posted on the NYMEX= =20 floor on a weekly basis. Compliance Staff will continue to post statistics= =20 for outright trades and will additionally post the statistics for spread=20 trades. These spread trade statistics are for information only so that you= =20 can assess your pit card submission rate in advance of incorporation of=20 spreads in the one-minute trade time submission percentages. For informati= on=20 purposes, the seller of the spread is considered to be the party who sells= =20 the premium month. In the case where the spread trades flat, the seller is= =20 the party who sells the nearby month. If you have any questions about this information, please call Nancy Minett,= =20 Compliance Counsel, at (212) 299-2940, or Thomas LaSala, Vice President=20 Compliance, at (212) 299-2897. __________________________________________________ Please click on the link below to indicate you have received this email. "http://208.206.41.61/email/email_log.cfm?useremail=3Dsara.shackleton@enron= .com& refdoc=3D(01-174)" Note: If you click on the above line and nothing happens, please copy the text between the quotes, open your internet browser, paste it into the web site address and press Return.
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