August 31, 2017
CFTC Orders Ikon Global Markets, Inc. to Pay $200,000 for Recordkeeping Violations
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today issued an Order filing and simultaneously settling charges against Ikon Global Markets, Inc. (Ikon) for failing to keep and promptly produce documentation for thousands of gold Exchange for Physical (EFP) trades, in violation of the Commodity Exchange Act (CEA) and CFTC Regulations. The trades were entered into by Ikon and reported to the NASDAQ OMX Futures Exchange, Inc. (NFX).
The CFTC Order requires Ikon to pay a $200,000 civil monetary penalty, to cease and desist from further violations of the CEA and CFTC Regulations, as charged, and to withdraw from, and never apply for, registration with the CFTC.
Ikon is a Futures Commission Merchant (FCM) incorporated and with a business address in New York, New York.
Specifically, the Order finds that from February 9, 2012, through September 12, 2012, Ikon, for a proprietary account, entered into thousands of EFP transactions with one of its customers, which were reported to the NFX. These EFP Transactions involved a privately negotiated and simultaneous exchange of a position in the XAU/USD Spot Gold Futures contract (NAU contract) for a corresponding and offsetting cash position in gold. As an FCM, Ikon was required to keep full, complete and systematic records relevant to its dealings in the NAU contract and any related cash positions, including all orders, copies of confirmations, and copies of statements of purchase and sale.
On March 18, 2015, the CFTC’s Division of Enforcement (Division) issued a subpoena requesting that Ikon produce, for certain accounts including the Ikon proprietary account and the relevant customer account, all documents related to transactions in the NAU contract, including, among other things, all orders. In the subpoena, Division staff also requested all documents reflecting any cash or other related position or the transfer of any cash or other related position in connection with any off-exchange transactions related to the NAU contract (i.e., the EFP Transactions). Further, according to the Order, on May 8, 2015, Ikon produced daily records reflecting the end of day positions in NAU contracts but did not produce records relevant to the EFP Transactions or other transactions involving the NAU contract.
On August 30, 2016, Division staff issued to Ikon a second subpoena which identified seven specific EFP transactions and requested certain documents regarding those transactions. Ikon produced certain additional documents for those seven transactions; however, its production did not include certain documents requested, such as customer orders, copies of confirmations, or copies of statements of purchase or sale, according to the Order. Division staff, by letter dated February 24, 2017, requested that all outstanding documents requested be produced by no later than March 17, 2017. Ikon failed to produce further documentation, the Order finds.
The CFTC thanks the National Futures Association, the NASDAQ Futures, Inc., and the Securities Commission of The Bahamas for their assistance in this matter.
The CFTC Division of Enforcement staff members responsible for this case are Xavier Romeu-Matta, Lara Turcik, Christopher Giglio, Patryk Chudy, Lenel Hickson, and Manal Sultan.
Last Updated: August 31, 2017