ICE Fines Tanius Technology $37,500 for Alleged Rule Breaches

The US futures exchange Intercontinental Exchange (ICE) announced on Tuesday a subcommittee of the Exchange's Business Conduct Committee (BCC) determined that in several instances between March 2020 and April 2020, Tanius Technology (Tanius) were suspicious of violating Exchange Rules 4.02(l)(1)(D) and 4.01(a).

Specifically, Tanius operated automated trading systems (ATSs) that malfunctioned in different Crude Diff - WTI 1st Line vs Brent 1st Line Future and Heating Oil Arb - Heating Oil 1st vs Low Sulphur Gasoil 1st Line Future (in Bbls) markets. The ATSs entered and withdrew bids and offers at prices that inadvertently incrementally narrowed the bid/ask spreads and caused the orders to eventually converge. But for the use of the Exchange's Self Trade Prevention Functionality, some of the orders would have resulted in self-trades.

The BCC further found that Tanius redeployed the malfunctioning ATSs after becoming aware of the ATSs problematic activity but before updates to the systems were implemented.

In accordance with the terms of settlement, in which Tanius neither admitted nor denied the alleged rule violations, Tanius agreed to pay a monetary penalty of $37,500.