Each of CME Group's exchanges, including the New York Mercantile Exchange (NYMEX), places an extremely high priority on preserving the confidentiality of customer information, and we expect our employees to abide by this guiding principal without exception.
For this reason, when we discover that any CME Group employee has acted contrary to this principle we take decisive action to reinforce our values and protect against the disclosure of confidential information.
Our policies and procedures designed to protect against the disclosure of confidential information are sound, and we continue to emphasize the importance of our values with our employees every day.
The CFTC court action announced today is disappointing because it relates to incidents that CME Group has already addressed and handled appropriately, and involved no harm to any customer or the markets.
Nevertheless, the CFTC is now seeking to hold NYMEX liable for the actions of these former employees, which were contrary to exchange policy and, when discovered, resulted in the immediate termination by us of their employment.
NYMEX is not being charged with any misconduct, is not being charged with a failure to properly supervise its employees, and is not being charged with a failure to adhere to the DCM core principles.
Rather, the CFTC is seeking to impose a monetary penalty against NYMEX based solely on these former employees' improper activities, even though no customer suffered any loss and no third party obtained any improper gain.
When we learned of instances in which NYMEX employees provided information to unauthorized third parties, for the purpose of providing business leads to those third parties, we immediately terminated the employees who engaged in this conduct and reported that misconduct to the CFTC.
Although the information disclosed was not and could not have been used to engage in insider trading or to otherwise affect the market in any way, nor did any customer suffer a financial loss resulting from these disclosures, we took swift action to make clear our commitment to protecting the confidentiality of any information concerning our customers.
We also reinforced procedures and practices to protect against and detect such misconduct in the future.
We believe the complaint against NYMEX is neither justified as a matter of law nor consistent with the regulatory structure established by the Commodity Exchange Act.
For these reasons, we have determined that we must oppose this case in court because we simply do not believe the CFTC's claims in this case are fair to NYMEX.
We are confident that the company will prevail on these claims.