(Reuters) – Nasdaq has agreed to pay $22 million to settle U.S. Commodity Futures Trading Commission (CFTC) charges that its former energy contract market failed to disclose details of perks offered to certain traders.
Nasdaq Futures Inc, which operated a market for energy commodity futures contracts from July 2015-2018, made false and misleading statements to the CFTC regarding an incentive program, the regulator said in a statement on Thursday.
Under the program, market makers and certain customers received payments based on the total volume of contracts they traded. This aspect was never disclosed to the agency, as required by U.S. law and regulation, CFTC said.
A spokesperson for Nasdaq Inc, which sold the futures exchange business in November 2019, said the firm is pleased to have resolved the matter with the CFTC.
The firm withheld accurate information from market participants in a “significant violation” of its obligations and legal requirements that apply to exchanges designated by the agency, CFTC enforcement director Ian McGinley said in a statement.
Republican Commissioner Caroline Pham dissented in the enforcement action, saying the settlement is “about beating a dead market” over incentive programs that are commonplace in financial markets.
(Reporting by Douglas Gillison and Chris Prentice; Editing by Richard Chang)
