COMEX FLOOR BROKER CHARGED BY CFTC WITH FAILING TO PRODUCE REGISTERED DOCUMENTS

FROM:  COMMODITY FUTURES TRADING COMMISSIONS 
CFTC Charges Registered COMEX Floor Broker Dominick Anthony Cognata with Failing to Produce Required Documents in Response to a CFTC Subpoena and Seeks to Revoke His Registration

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today filed two separate administrative proceedings against Dominick Anthony Cognata, a registered COMEX floor broker. In one proceeding, a Complaint charges Cognata with failing to produce, or otherwise make available, to the CFTC certain records relating to his brokerage activities, in violation of Section 4g of the Commodity Exchange Act (CEA) and CFTC Regulations 1.31(a) and 1.35(a). In the other proceeding, a Notice of Intent to Revoke (Notice) seeks to revoke Cognata’s registration as a floor broker, under Sections 8a(3)(M) and 8a(4) of the CEA.

As alleged in the CFTC Complaint, on or about August 14, 2012, the CFTC’s Division of Enforcement, as part of an ongoing investigation, issued a lawfully-authorized subpoena to Cognata for the production of documents, including trading cards, order tickets, and other documents relating to his trading of gold or silver futures or options on futures, which were required to be made, kept and produced by floor brokers pursuant to the CEA and CFTC Regulations. To date, Cognata has failed to produce any documents in response to the subpoena, according to the Complaint. As a result of Cognata’s violations, the CFTC is seeking a civil monetary penalty and an Order that Cognata cease and desist from violating the provisions of the CEA and CFTC Regulations, as charged.

In the Notice, the CFTC is seeking the revocation of Cognata’s registration as a floor broker for “good cause.” It is alleged that the facts constituting “good cause” include, in addition to Cognata’s failure to produce records to the CFTC, the settlements and findings in two exchange disciplinary actions against Cognata since 2011. In one exchange disciplinary action, the Notice alleges, pursuant to an offer of settlement, a panel of the COMEX Business Conduct Committee (the Panel) found that on various dates from October through December 2008, Cognata engaged in noncompetitive, prearranged trades of silver and gold options. In the other exchange disciplinary action, the Notice alleges, pursuant to an offer of settlement, the Panel found that on three occasions in June and July 2011, Cognata prearranged trades in silver options for the purpose of receiving money passes from other COMEX members. In both disciplinary actions, Cognata neither admitted nor denied any rule violations in his offers of settlement.

CFTC Division of Enforcement staff members responsible for this matter include K. Brent Tomer, R. Stephen Painter, Jr., Patrick Daly, Trevor Kokal, Sheila Marhamati, Elizabeth Brennan, Steven I. Ringer, Lenel Hickson, Stephen J. Obie, Manal Sultan, and Vincent A. McGonagle.