UNITED STATES OF AMERICA

Before the

COMMODITY FUTURES TRADING COMMISSION

In the Matter of:

UBS AG,

Respondent.

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CFTC Docket No. 18-07

ORDER INSTITUTING PROCEEDINGS PURSUANT TO

SECTION 6(c) AND (d) OF THE COMMODITY EXCHANGE ACT, MAKING 

FINDINGS AND IMPOSING REMEDIAL SANCTIONS

I.

INTRODUCTION

The Commodity Futures Trading Commission (“Commission”) has reason to believe that

UBS AG (“UBS AG” or “Respondent”) violated the Commodity Exchange Act (the “Act” or 

“CEA”) and Commission Regulations (“Regulations”). Therefore, the Commission deems it 

appropriate and in the public interest that public administrative proceedings be, and hereby are, 

instituted to determine whether Respondent engaged in the violations set forth herein and to 

determine whether any order should be issued imposing remedial sanctions.

In anticipation of the institution of an administrative proceeding, Respondent has

submitted an Offer of Settlement (“Offer”) that the Commission has determined to accept.

Without admitting or denying any of the findings or conclusions herein, Respondent consents to 

the entry of this Order Instituting Proceedings Pursuant to Section 6(c) and (d) of the Commodity 

Exchange Act, Making Findings and Imposing Remedial Sanctions (“Order”), and acknowledges

service of this Order.1

 1 Respondent consents to the use of the findings of fact and conclusions of law in this Order in this 

proceeding and in any other proceeding brought by the Commission or to which the Commission is a 

party or claimant, and agree that they shall be taken as true and correct and be given preclusive effect 

therein, without further proof. Respondent does not consent, however, to the use of this Order, or the 

findings or conclusions herein, as the sole basis for any other proceeding brought by the Commission or 

to which the Commission is a party, other than a proceeding in bankruptcy or receivership; or a 

proceeding to enforce the terms of this Order. Respondent does not consent to the use of the Offer or this 

Order, or the findings or conclusions in this Order, by any other party in any other proceeding.
II. 

FINDINGS 

The Commission finds the following: 

A. SUMMARY 

From January 2008 and continuing through at least December 2013 (the "Relevant 

Period"), UBS, by and through the acts of certain precious metals traders on the spot desk, 

attempted to manipulate the price of precious metals futures contracts by utilizing a variety of 

manual spoofing techniques. On numerous occasions throughout the Relevant Period, a number 

of UBS precious metals traders located in and outside the United States (collectively, the 

"Traders"), placed orders to buy or sell precious metals futures contracts, including gold and 

silver ("precious metals") with the intent to cancel the orders before execution. By and through 

the acts of these Traders, UBS engaged in unlawful spoofing. 

On those occasions, UBS, by and through the acts of the Traders, intended to induce 

other market participants into buying and selling precious metals futures contracts. In engaging 

in the unlawful spoofing conduct, UBS, by and through the acts of the Traders, also intended to 

manipulate the prices of the precious metals futures contracts. UBS, by and through the acts of 

the Traders, sought to induce other market participants to fill the resting orders placed by the 

Traders at UBS on the opposite side of the market from the orders that they placed with the 

intent to cancel before execution. 

Separately, on certain other occasions between December 2009 through February 2012, 

UBS, by and through the acts of one of the Traders, placed orders and executed trades with the 

intent of manipulating the price of precious metals futures contracts for the purpose of triggering 

customers' stop-loss orders.2 This UBS trader coordinated his trading with another precious 

metals trader at another large financial institution ("Financial Institution 1 "). On those 

occasions, intentionally triggering stop-loss orders would have allowed the UBS trader to buy 

precious metals futures contracts at artificially low prices or sell precious metals futures 

contracts at artificially high prices, for the benefit of his proprietary trading. 

* * * * * 

In accepting the Offer of Settlement, the Commission recognizes UBS' s self-reporting 

and cooperation during the Division of Enforcement's ("Division") investigation of this matter, 

which is explained in more detail below. The Commission notes that UBS' s self-reporting, 

cooperation and remediation, are being recognized in the form of a substantially reduced civil 

monetary penalty. 

2 A stop-loss order, or stop order, is an order that becomes a market order when a particular price 

level is reached. A sell stop is placed below the market; a buy stop is placed above the market. 

2 
B. RESPONDENT 

UBS AG ("UBS") is a Swiss banking and financial services company headquartered in 

Zurich and Basel, Switzerland, that provides investment banking, asset management and wealth 

management services for private, corporate and institutional clients worldwide. It has operations 

in over fifty countries, including the United States. 

C. FACTS 

During the Relevant Period, UBS was engaged in precious metals trading, which 

included making markets and engaging in proprietary trading in, among other things, precious 

metals spot and futures markets. As part of UBS' s business, Traders placed orders and entered 

into transactions for precious metals futures contracts traded on the Commodity Exchange, Inc. 

("COMEX"), a futures exchange and designated contract market which is owned and operated 

by CME Group, Inc. ("CME"). UBS, by and through its Traders, traded precious metals futures 

contracts on behalf of the bank. 

1. Spoofing and Attempted Manipulation 

UBS, by and through the acts of the Traders, placed bids or offers on COMEX with the 

intent to cancel before execution, thus attempting to manipulate the price of precious metals 

futures contracts by utilizing a variety of manual spoofing techniques. 

Generally, the Traders placed relatively large bids or offers in the futures market with the 

intent to cancel before execution (the "spoof orders") after another smaller bid or offer (the 

"resting order") was placed on the opposite side of the same market. The Traders placed their 

spoof orders with the intent to create the false appearance of market depth, which the Traders 

believed and intended to create the impression of greater buying or selling interest than would 

have existed otherwise. The Traders placed such spoof orders with the intent to induce other 

market participants to fill their resting orders on the opposite side of the market from their spoof 

orders. In engaging in the spoofing conduct, the Traders also intended to manipulate the price of 

the relevant futures contract. Thereafter, the Traders cancelled the spoof orders after the resting 

orders were filled or when there was too great a risk of the spoof orders being executed. 

During the Relevant Period, the Traders also discussed their efforts to spoof and attempts 

to manipulate the price of precious metals futures contracts in internal and external chats and 

electronic messages, as shown in the examples below. 

On January 25, 2008, a UBS trader, Trader A, discussed trading activity with a trader, 

Trader B, who was employed by another large financial institution ("Financial Institution 1 "). 

Trader A wrote: "hahaah", to which Trader B responded: "u [mu]st have [a]bout gazillions ... 

and u spoof the sell." Trader A wrote: "we good ain[']t we", to which Trader B responded: 

"not very friendly." Trader A wrote further: "we never are ... u want a fr[ien]d ... get a dog ... 

ahahahah." (Emphasis added.) 

On May 13, 2008, another UBS trader, Trader C, discussed trading activity with a trader 

employed by Financial Institution 1, Trader D. Trader D wrote: "TKU [thank you] 

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SERG[E]ANT SPOOF ... [YO]UR NEW NAME [Trader C.]" Trader C responded: "HAHA 

NEVER SPOFF [sic] ... SPOOF UNLESS I['MJ F ... " Trader D responded: "HAHAHAH 

YEA ... THEN I['JM F ..... " (Emphases added.) 

Similarly, on November 27, 2009, Trader A and another trader, Trader E, who was 

employed by another large financial institution ("Financial Institution 2") discussed trading 

activity. Trader A stated in a chat: "btw the silver i bought the other day was a bit of a spoof 

too ... we are all big boys aren['Jt we." Trader E responded: "you mean t[he] ""cheapies"" you 

got from me? ... bastard." Trader A wrote further: "hahahaha ... tlte spoofwasn['Jt designed 

just/or [you]." Trader E wrote: "and you hit a bid." Trader A responded: "that is nasty ... nono 

just pushed a bit then called out ... [c]an[']t be too obvious." (Emphases added.) 

In another example, on April 30, 2010, another UBS trader, Trader F discussed trading 

activity with another UBS trader, Trader G. Trader F wrote: "u gotta be quick with spoofs cause 

everyone else knows the trick too ... except for smaller shops ... and a/gos of course." Trader 

F wrote further: "u know i use[d] to do that is Stamford soi can get/Uled ... i'd be short ]Ok, 

show a bid/or 35 lots ... mkt chases it ... i shift it lower ... and lower." (Emphases added.) 

In another example, on August 2, 2010, Trader F was discussed trading activity with 

another UBS trader. Trader F wrote: "u know when u were gone i did the regular bid/offer 

thing to spoof ... i got lifted twice haha ... think that trick is slowly starting to catch up." 

Trader F wrote further: "sometimes ... but when i see stuff like that in the futures i been 

smacking it ... last time me and [Financial Institution JJ were doing that, worked in our 

favor." (Emphases added.) 

In a July 19, 2011 chat, Trader F discussed trading activity with another trader, Trader H, 

who was employed by Financial Institution 1 in Singapore. Trader F wrote: "u are short, u want 

me to ram up gold? ... haha." Trader Hat Financial Institution 1 responded, "haha ... yes." 

Trader F wrote further: ''just sit on the bid ... let me spoof it for u ... don['Jt pay me on the 

futures." (Emphasis added.) 

As reflected in these communications and other evidence, the UBS Traders engaged in 

spoofing and attempted to manipulate the precious metals futures markets. 

2. Attempted Manipulation Relating to Stop Loss Orders 

On certain other occasions, between December 2009 through February 2012, one UBS 

trader, Trader F, attempted to manipulate the price of precious metals futures contracts in a 

manner that could trigger customer stop-loss orders in the market in order to obtain a profit. 

Trader F coordinated this trading with Trader H at Financial Institution 1. 

On certain occasions, a customer had a stop-loss order placed through UBS, and Trader F 

coordinated with Trader H at Financial Institution 1 to place orders and execute trades in an 

attempt to push the price up or down, as needed, in the precious metals futures markets in an 

attempt to trigger the customer's stop-loss order. On other occasions, Trader F would 

communicate with Trader H at Financial Institution 1 to determine the level in the market that 

customer stop-loss orders were resting at Financial Institution 1, and would coordinate their 

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precious metals futures trading also for the purpose of triggering the customer's stop-loss orders. 

Trader F engaged in this conduct intending to manipulate the prices of the precious metals 

futures contracts. Trader F executed trades with the understanding that his orders and trades had 

the ability to affect or influence prices. Trader F sought to benefit from the attempted 

manipulation by buying or selling futures contracts at prices that were artificially high or low. 

Trader F and Trader H at Financial Institution 1 regularly discussed their attempts to 

manipulate through the stop loss manipulation strategies. Below are several examples of such 

chats. 

On September 3, 2010, Trader F discussed trading to trigger stop loss orders with Trader 

H at Financial Institution 1: " ... when u push for stops u can['Jt wait for dip, u gotta hold the 

bid and slowly push it up." Trader H responded: "haha true ... ok will see how the master does 

it." (Emphasis added.) 

On November 18, 2010, Trader Hat Financial Institution 1 told Trader F, "fl] have 

chunky stop at 27.35 ... keep to urself." Trader F told Trader H "go get that chunky monkey," 

to which Trader H responded, "i am," and asked Trader F "u wanna come on boar[d]?" Trader 

F agreed and wrote, "I'll get a 40 print/or you." Trader H responded by calling them "the hunt 

brothers." In response, Trader F wrote, "chill man, they went to jail." (Emphases added.) 

In another example, on January 7, 2011, Trader H at Financial Institution 1 asked Trader 

F, via a chat, about the level in the market at which customer stop loss orders were resting. 

Trader H asked "where are ur stops ... i can hunt with u." A few minutes later, Trader F asked 

Trader H "yo can u help me push silver down? ... im stuck with this stop damnit ... need a 72 

print." When the market reached the stop level that they were seeking, Trader H told Trader F 

"there u go." After the trading sequence, Trader H wrote to Trader F "i practice my hammer 

well right," to which Trader F commented that "ijust need a 72 print haha, u really hutched it." 

(Emphases added.) 

On January 19, 2011, Trader F told Trader Hat Financial Institution 1 that he intends to 

get a "43 print" in platinum and tells him to "go long the plat[inum]." Trader H responded 

"loaded up some," and bought platinum futures contracts. Trader H then told Trader F, "i help u 

print it." A few minutes later, Trader F wrote, "get ready," and Trader H responded "let me 

know ... when to let the proton cannon loose." Shortly thereafter, Trader F wrote, "steady ... 

steady ... ok lets go." Trader H then bought more platinum futures contracts and wrote "that was 

for the print ... can sell u back."(Emphases added.) 

On March 29, 2011, Trader F asked Trader Hat Financial Institution 1 for assistance in 

the gold futures market, asking Trader H to ''push it up" because Trader F "need[ ed] a print." 

Trader F then told Trader H that he "got it" [i.e., the print]. A few minutes later, Trader F 

offered to sell Trader H gold futures contracts at an advantageous price "cause u helped me for 

the print." (Emphases added.) 

On August 11, 2011, Trader F and Trader H at Financial Institution 1 were discussing 

coordination of stop loss manipulation and Trader H wrote "the 1 lot offer ... is so powerful ... i 

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love it." Trader F responded, "it depends what kinda mkt ... sometimes u use muscle ... 

sometimes u use blade ... this is blade ... but then two guys doing it like this together is small 

muscle and blade." Trader H responded, ''yeah ... dude ... i like it ... double dragon." 

(Emphases added.) 

As reflected in these communications and other evidence, Trader F at UBS on occasion 

colluded with and coordinated his trading with Trader H at Financial Institution 1, in an attempt 

to manipulate the precious metals futures markets. 

3. UBS's Self-Reporting, Cooperation and Remediation 

During the course of an internal investigation, UBS discovered potential misconduct , of 

which the Division was previously unaware. After discovering that misconduct, UBS promptly 

self-reported the misconduct to the Division and continued its internal investigation. 

During its investigation, UBS, among other things, notified the Division of potential 

misconduct as it uncovered it and provided the Division timely updates on its internal 

investigation on a rolling basis; disclosed to the Division pertinent facts relevant to that 

misconduct, including facts related to involvement of individuals; identified specific documents 

in its productions that were particularly relevant to the misconduct at issue, and provided the 

Division information relating to the provenance of the documents. 

UBS also proactively worked to remediate and enhance its compliance systems and 

policies related to spoofing in precious metals futures contracts, and futures contracts generally. 

Due to UBS' s self-reporting, cooperation, and remediation, the civil monetary penalty 

imposed by the Commission has been substantially reduced from the otherwise applicable 

penalty. 

III. 

LEGAL DISCUSSION 

A. Attempted Manipulation of the Price of Precious Metals Futures Contracts, in 

Violation of Section 9{a)(2) of the Act; Sections 6(c) and 6(d) of the Act (for Conduct 

Occurring Prior to August 15, 2011); Sections 6(c)(l), 6(c)(3) and 6(d) of the Act 

and Regulations 180.1 and 180.2 (for Conduct Occurring On or After August 15, 

2011) 

Together, Sections 6(c),3 6(d) and 9(a)(2) of the Act prohibit acts of manipulation and 

attempted manipulation. 7 U.S.C. §§ 9, 13b, 13(a)(2) (2012). Section 9(a)(2) of the Act makes 

it unlawful for "[ a ]ny person to manipulate or attempt to manipulate the price of any commodity 

in interstate commerce, or for future delivery on or subject to the rules of any registered entity." 

7 U.S.C. § 13(a)(2) (2012). 

Section 6( c) was amended effective August 15, 2011. 

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For conduct prior to August 15, 2011, Section 6(c) and (d) of the Act authorizes the 

Commission to serve a complaint and provide for the imposition of, among other things, civil 

monetary penalties and cease and desist orders if the Commission "has reason to believe that 

any person ... has manipulated or attempted to manipulate the market price of any commodity, 

in interstate commerce, or for future delivery on or subject to the rules of any registered entity, 

... or otherwise is violating or has violated any of the provisions of [the] Act." 7 U.S.C. §§ 9, 

13b (2006). 

For conduct occurring on or after August 15, 2011, the Commission is authorized to 

serve a complaint and impose penalties and cease and desist orders with regard to manipulation 

and attempted manipulation in violation of the broader amended provisions of Sections 6( c )(1) 

and 6(c)(3) of the Act, 7 U.S.C. § 9(1), (3) (2012), and the Regulations implementing those 

provisions. Section 6(c)(l) of the Act prohibits the use or attempted use of any manipulative 

device in connection with any swap or contract of sale of any commodity in interstate 

commerce, or for future delivery, 7 U.S.C. § 9(1) (2012), and Regulation 180.l(a)(l), 17 C.F.R. 

§ 180.l(a)(l) (2017), makes it "unlawful ... , directly or indirectly, in connection with any 

swap, or contract of sale of any commodity in interstate commerce, or contract for future 

delivery on or subject to the rules of any registered entity, to ... (1) [u]se ... or attempt to use . 

. . any manipulative device, scheme or artifice to defraud .... " Section 6(c)(3) of the Act 

prohibits the manipulation or attempted manipulation of the price of any commodity in interstate 

commerce, 7 U.S.C. § 9(3) (2012), and Regulation 180.2, 17 C.F.R. § 180.2 (2017), makes it 

"unlawful ... directly or indirectly, to manipulate or attempt to manipulate the price of any 

swap, or of any commodity in interstate commerce, or for future delivery on or subject to the 

rules of any registered entity." 

As described above, UBS AG, by and through the acts of the Traders, attempted to 

manipulate the price of precious metals futures contracts by utilizing a variety of manual 

spoofing techniques, in violation of Section 9(a)(2) of the Act, 7 U.S.C. § 13(a)(2) (2012); 

Sections 6(c) and 6(d) of the Act, 7 U.S.C. §§ 9, 13b (2006), for conduct occurring prior to 

August 15, 2011; and Sections 6(c)(l), 6(c)(3) and 6(d) of the Act, 7 U.S.C. §§ 9(1), 9(3), 13b 

(2012),andRegulations 180.1 and 180.2, 17C.F.R. §§ 180.1, 180.2(2017),forconduct 

occurring on or after August 15, 2011. 

Furthermore, UBS, by and through the conduct of Trader F, attempted to manipulate the 

price of precious metals futures contracts by engaging in scheme to trigger customer stop-loss 

orders, in violation of Section 9(a)(2) of the Act, 7 U.S.C. § 13(a)(2) (2012); Sections 6(c) and 

6(d) of the Act, 7 U.S.C. §§ 9, 13b (2006), for conduct occurring prior to August 15, 2011; 

Sections 6(c)(l), 6(c)(3) and 6(d) of the Act, 7 U.S.C. §§ 9(1), 9(3), 13b (2012), and Regulations 

180.1 and 180.2, 17 C.F.R. §§ 180.1, 180.2 (2017), for conduct occurring on or after August 15, 

2011. 

B. Spoofing in the Precious Metals Futures Markets, in Violation of Section 4c(a)(5)(C) 

of the Act 

Section 4c(a)(5) of the Act makes it unlawful for "[a]ny person to engage in any trading, 

practice, or conduct on or subject to the rules of a registered entity that ... is, is of the character 

of, or is commonly known to the trade as, 'spoofing' (bidding or offering with the intent to 

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cancel the bid or offer before execution)." 7 U.S.C. § 6c(a)(5)(C) (2012). See also United States 

v. Coscia, 866 F.3d 782, 793 (7th Cir. 2017) (holding that because the CEA clearly defines 

spoofing, it provides adequate notice of prohibited conduct). 

As described above, UBS AG, by and through the acts of the Traders, entered bids or 

offers on a registered entity with the intent to cancel the bids or offers before execution, in 

violation of Section 4c(a)(5)(C) of the Act. See, e.g., In re Posen, CFTC No. 17-20, 2017 WL 

3216576, at *2 (July 26, 2017) (consent order) (manual trader "entered into thousands of bids or 

offers on a registered entity with the intent to cancel the bids or offers before execution in 

violation of Section 4c(a)(5)(C) of the Act"); CFTC v. Oystacher, 203 F. Supp. 3d 934, 942 

(N.D. Ill. 2016) (denying motion for judgment on the pleadings, holding that all~gations of 

placing "both bids and offers with the intent to cancel those bids or offers before execution" 

constitutes "trading behavior [that] falls within the Spoofing Statute's defined prohibition"); 

CFTC v. Nav Sarao Futures Ltd., No. 15-3398, 2016 WL 8257513, at *10 (N.D. Ill. Nov. 14, 

2016) (consent order) (finding that defendants engaged in spoofing techniques by, among other 

things, "plac[ing] tens of thousands of bids and offers for the E-Mini S&P contract with the 

intent of cancelling those bids and offers before execution (i.e., Spoof Orders)"); CFTC v. 

Khara, No. 15-CV-03497, ECF 35 at 6 (S.D.N.Y. Mar. 31, 2016) (consent order) (finding that 

"Defendants ... engaged in unlawful disruptive trading practices or conduct in the gold and silver 

futures markets ... that were, were of the character of, or were commonly known to the trade as 

'spoofing' (bidding and offering with the intent to cancel the bid or offer before execution)"). 

C. UBS AG Is Liable for the Acts of Its Agents 

Section 2(a)(l)(B) of the Act, 7 U.S.C. § 2(a)(l)(B) (2012), and Regulation 1.2, 

17 C.F.R. § 1.2 (2017), provide that "[t]he act, omission, or failure of any official, agent, or other 

person acting for any individual, association, partnership, corporation, or trust within the scope 

of his employment or office shall be deemed the act, omission, or failure of such individual, 

association, partnership, corporation, or trust." Pursuant to Section 2(a)(l)(B) of the Act and 

Regulation 1.2, strict liability is imposed on principals for the actions of their agents. See, e.g., 

Rosenthal & Co. v. CFTC, 802 F.2d 963, 966 (7th Cir. 1986); CFTC v. Byrnes, 58 F. Supp. 3d 

319,324 (S.D.N.Y. 2014). 

The acts, omissions, and failures of the Traders occurred within the course and scope of 

their employment, office, or agency with UBS AG; therefore, pursuant to Section 2(a)(l)(B) of 

the Act, and Regulation 1.2, UBS AG is liable for the acts, omissions, and failures of the Traders 

in violation of the provisions of the Act and Regulations cited above. 

IV. 

FINDINGS OF VIOLATIONS 

Based on the foregoing, the Commission finds that UBS AG violated the Act and 

Regulations, as follows: 

(i) UBS AG attempted to manipulate prices, in violation of: Section 9(a)(2) of the Act; 

7 U.S.C. § 13(a)(2) (2012); Sections 6(c) and 6(d) of the Act, 7 U.S.C. §§ 9, 13b (2006), 

8 
for conduct occurring prior to August 15, 2011; and Sections 6(c)(l), 6(c)(3) and 6(d) of 

the Act, 7 U.S.C. §§ 9(1), 9(3), 13b (2012), and Regulations 180.1 and 180.2, 17 C.F.R. 

§§ 180.1, 180.2 (2017), for conduct occurring on or after August 15, 2011; and 

(ii) UBS AG engaged in spoofing in the precious metals futures markets in violation of 

Section 4c(a)(5) of the Act, 7 U.S.C. § 6c(a)(5)(C) (2012), for conduct occurring on or 

after July 16, 2011. 

V. 

OFFER OF SETTLEMENT 

Respondent has submitted the Offer in which it: 

A. Acknowledges receipt of service of this Order; 

B. Admits the jurisdiction of the Commission with respect to all matters set forth in this 

Order and for any action or proceeding brought or authorized by the Commission based 

on violation of or enforcement of this Order; 

C. Waives: 

1. The filing and service of a complaint and notice of hearing; 

2. A hearing; 

3. All post-hearing procedures; 

4. Judicial review by any court; 

5. Any and all objections to the participation by any member of the Commission's 

staff in the Commission's consideration of the Offer; 

6. Any and all claims that it may possess under the Equal Access to Justice Act, 5 

U.S.C. § 504 (2012) and 28 U.S.C. § 2412 (2012), and/or the rules promulgated by 

the Commission in conformity therewith, Part 148 of the Commission's 

Regulations, 17 C.F.R. pt. 148 (2017), relating to, or arising from, this proceeding; 

7. Any and all claims that it may possess under the Small Business Regulatory 

Enforcement Fairness Act of 1996, Pub. L. No. 104-121, §§ 201-253, 110 Stat. 

847, 857-874 (codified as amended in scattered sections of 5 U.S.C. and 15 

U.S.C.), relating to, or arising from, this proceeding; and 

8. Any claims of Double Jeopardy based on the institution of this proceeding or the 

entry in this proceeding of any order imposing a civil monetary penalty or any 

other relief; 

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D. Stipulates that the record basis on which this Order is entered shall consist solely of the 

findings contained in this Order to which Respondent has consented in the Offer; 

E. Requests, for the reasons set forth in Respondent's letter dated January 22, 2018 

("Request Letter"), that the Commission advise that, under the circumstances, 

disqualification under Rule 262(a) of Regulation A and Rule 506(d)(l) of Regulation D 

of the Securities & Exchange Commission ("SEC"), 17 C.F.R. §§ 230.262(a), 

230.506(d)(l) (2017), should not arise as a consequence of this Order; 

F. Consents, solely on the basis of the Offer, to the Commission's entry of this Order that: 

1. Makes findings by the Commission that: 

(i) UBS AG attempted to manipulate prices in violation of: Section 9(a)(2) of the 

Act, 7 U.S.C. § 13(a)(2) (2012); Sections 6(c) and 6(d) of the Act, 7 U.S.C. §§ 9, 

13b (2006), for conduct occurring prior to August 15, 2011; and Sections 6(c)(l), 

6(c)(3) and 6(d) of the Act, 7 U.S.C. §§ 9(1), 9(3), 13b (2012), and Regulations 

180.1 and 180.2, 17 C.F.R. §§ 180.1, 180.2 (2017), for conduct occurring on or 

after August 15, 2011; and 

(ii) UBS AG engaged in spoofing in the precious metals futures markets in 

violation of Section 4c(a)(5) of the Act, 7 U.S.C. § 6c(a)(5)(C) (2012), for 

conduct occurring on or after July 16, 2011. 

2. Orders Respondent to cease and desist from violating the Act and Regulations, as 

set forth below; 

3. Orders Respondent to pay a civil monetary penalty in the amount of fifteen million 

dollars ($15,000,000), within ten (10) days of the date of entry of this Order. If the 

CMP Obligation is not paid in full within ten (10) days of the date of entry of the 

Order, then post-judgment interest shall accrue on the CMP Obligation beginning 

on the date of entry of the Order and shall be determined by using the Treasury 

Bill rate prevailing on the date of entry of the Order pursuant to 28 U.S.C. § 1961 

(2012). 

4. Orders Respondent and its successors and assigns to comply with the conditions 

and undertakings consented to in the Offer and as set forth in Part VI of this Order; 

and 

5. Advises that, under the circumstances, disqualification under Rule 262(a) of 

Regulation A and Rule 506(d)(l) of Regulation D of the SEC should not arise as a 

consequence of this Order. 

Upon consideration, the Commission has determined to accept the Offer. 

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VI. 

ORDER 

Accordingly, IT IS HEREBY ORDERED THAT: 

A. Respondent and its successors and assigns shall cease and desist from violating: 

1. Sections 6(c)(l), 6(c)(3), 6(d) and 9(a)(2) of the Act, 7 U.S.C. §§ 9(1), 9(3), 13b, 13(a)(2) 

(2012), and Regulations 180.1 and 180.2, 17 C.F.R. §§ 180.1, 180.2 (2017); and 

2. Section 4c(a)(5) of the Act, 7 U.S.C. § 6c(a)(5)(C) (2012). 

B. Respondent shall pay a civil monetary penalty in the amount of fifteen million dollars 

($15,000,000) ("CMP Obligation"), within ten (10) days of the date of the entry of this 

Order. If the CMP Obligation is not paid in full within ten ( 10) days of the date of entry 

of this Order, then post-judgment interest shall accrue on the CMP Obligation beginning 

on the date of entry of this Order and shall be determined by using the Treasury Bill rate 

prevailing on the date of entry of this Order pursuant to 28 U.S.C. § 1961 (2012). 

Respondent shall pay the CMP Obligation by electronic funds transfer, U.S. postal 

money order, certified check, bank cashier's check, or bank money order. If payment is 

to be made other than by electronic funds transfer, then the payment shall be made 

payable to the Commodity Futures Trading Commission and sent to the address below: 

Commodity Futures Trading Commission 

Division of Enforcement 

ATTN: Accounts Receivables 

DOT/F AA/MMAC/ AMZ-341 

CFTC/CPSC/SEC 

6500 S. MacArthur Blvd. 

Oklahoma City, OK 73169 

( 405) 954-7262 (office) 

(405) 954-1620 (fax) 

marie.thorn@faa.gov 

If payment is to be made by electronic funds transfer, Respondent shall contact Marie 

Thorn or her successor at the above address to receive payment instructions and shall 

fully comply with those instructions. Respondent shall accompany payment of the CMP 

Obligation with a cover letter that identifies the paying Respondent and the name and 

docket number of this proceeding. The paying Respondent shall simultaneously transmit 

copies of the cover letter and the form of payment to the Chief Financial Officer, 

Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st Street, NW, 

Washington, D.C. 20581. 

C. Respondent and its successors and assigns shall comply with the following conditions 

and undertakings set forth in the Offer: 

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1. Public Statements: Respondent agrees that neither it nor any of its successors and 

assigns, agents or employees under its authority or control shall take any action or 

make any public statement denying, directly or indirectly, any findings or 

conclusions in this Order or creating, or tending to create, the impression that this 

Order is without a factual basis; provided, however, that nothing in this provision 

shall affect Respondent's: (i) testimonial obligations; or (ii) right to take legal 

positions in other proceedings to which the Commission is not a party. Respondent 

and its successors and assigns shall comply with this agreement, and shall undertake 

all steps necessary to ensure that all of its agents and/or employees under their 

authority or control understand and comply with this agreement. 

2. Procedures and Controls to Detect Spoofing Activity: Respondent shall continue 

to implement systems and controls reasonably designed to detect spoofing activity 

by its traders on or subject to the rules of a registered entity, such as the systems 

and controls Respondent developed and implemented in response to the Traders' 

spoofing activity. These systems and controls shall, at a minimum, be designed to 

detect and generate a report regarding patterns of trading that might constitute 

spoofing activity. Respondent's personnel shall promptly review such reports and 

follow up as necessary to determine whether spoofing activity has occurred. 

3. Training: Respondent shall maintain its training program that provides training, 

at least annually, addressing the legal requirements of the Act with regard to 

spoofing, manipulation and attempted manipulation, to be given to all employees 

trading on behalf of Respondent or other affiliated entities who submit any orders 

on futures markets, and their supervisors. 

4. Cooperation with the Commission: Respondent shall continue to cooperate fully 

and expeditiously with the Commission, including the Division, in this action, and 

in any current or future Commission investigation or action related thereto. 

Respondent shall also cooperate with the Commission in any investigation, civil 

litigation, or administrative matter related to, or arising from, this action. As part 

of such cooperation, Respondent agrees to: 

1. preserve and produce to the Commission in a responsive and prompt 

manner, as requested by Division Staff, all non-privileged documents, 

information, and other materials wherever located, subject to applicable 

laws and regulations, including but not limited to audio files, electronic 

communications, and trading records and data, in the possession, custody, 

or control of Respondent; 

11. comply fully, promptly, completely and truthfully, subject to any legally 

recognized privilege or applicable law and regulations, with any inquiries 

or requests for information and documents by the Commission; 

111. identify and authenticate relevant documents and other evidentiary 

materials, execute affidavits or declarations, and provide a corporate 

representative to testify completely and truthfully at depositions, trial, and 

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other judicial proceedings, when requested to do so by the Division Staff, 

subject to applicable law and regulations; 

1v. use its best efforts to produce any current (as of the time of the request) 

officer, director, employee, or agent of UBS, regardless of the individual's 

location and at such a location that minimizes Commission travel 

expenditures, to provide assistance at any trial, proceeding, or Commission 

investigation related to the subject matter of this proceeding, including but 

not limited to, requests for testimony, depositions, and/or interviews, and to 

encourage them to testify completely and truthfully in any such proceeding, 

trial or investigation, subject to applicable law and regulations; and 

v. subject to applicable laws and regulations, use its best efforts to assist in 

locating and contacting any prior (as of the time of the request) officer, 

director, employee or agent of UBS. 

5. Prohibited or Conflicting Undertakings: Should the Undertakings herein be 

prohibited by, or be contrary to, the provisions of any obligations imposed on 

Respondent by any presently existing, or hereinafter enacted or promulgated laws, 

rules, regulations, or regulatory mandates, then Respondent shall promptly 

transmit notice to the Commission (through the Division) of such prohibition or 

conflict, and shall meet and confer in good faith with the Commission (through 

the Division) to reach an agreement regarding possible modifications to the 

Undertakings herein sufficient to resolve such inconsistent obligations. In the 

interim, Respondent will abide by the obligations imposed by the laws, rules, 

regulations, and regulatory mandates. Nothing in these Undertakings shall limit, 

restrict or narrow any obligations pursuant to the Act or the Commission's 

Regulations promulgated thereunder, including, but not limited to, Regulations 

1.31 and 1.35, 17 C.F.R.§§ 1.31, 1.35 (2017), in effect now or in the future. 

6. Partial Satisfaction: Respondent understands and agrees that any acceptance by the 

Commission of any partial payment of Respondent's CMP Obligation shall not be 

deemed a waiver of its obligation to make further payments pursuant to this Order, or a 

waiver of the Commission's right to seek to compel payment of any remaining balance. 

D. Based on the nature of the violations; the findings made, and the sanctions, conditions, and 

undertakings imposed in the Order; and the facts and representations in Respondent's 

Request Letter, the Commission advises4 that, under the circumstances, disqualification 

4 Rule 506(d)(l)(iii)(B) disqualifies an issuer from relying on the private offering exemptions provided for in 

Rule 506 if they or certain related parties are "subject to a final order of ... [inter alia] the U.S. Commodity Futures 

Trading Commission ... that: ... [ c ]onstitutes a final order based on a violation of any law or regulation that 

prohibits fraudulent, manipulative, or deceptive conduct." Rule 506(d)(2)(iii), however, provides that 

disqualification "shall not apply" if the CFTC "advises in writing" that disqualification under Rule 506(d)(l) 

"should not arise as a consequence of such order." See also 17 C.F.R. §§ 262(a)(3)(ii), (b)(3) (parallel provisions 

under Regulation A); SEC, Exemptions to Facilitate Intrastate and Regional Securities Offerings, 81 Fed. Reg. 

83,494, 83,545 (Nov. 21, 2016) (stating that disqualification under Rule 504 arises "absent a waiver or other 

exception provided in Rule 506( d)"). 

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under Rule 262(a) of Regulation A and Rule 506(d)(l) of Regulation D of the SEC, 17 C.F.R. 

§§ 230.262(a), 230.506(d)(l) (2017), should not arise as a consequence of this Order. 5 

The Commission notes that if the facts are different from those represented, or 

Respondent fails to comply with the terms of the Order, the Commission may, in its 

discretion, revisit its advice that disqualification should not arise. The Commission 

reserves the right, in its sole discretion, to withdraw or otherwise revoke or further 

condition its advice under those circumstances. 

The provisions of this Order shall be effective as of this date. 

By the Commission. 

~ ~-0c£;d/ Christopher J. irkpatrick 

Secretary of the Commission 

Commodity Futures Trading Commission 

Dated: January 29, 2018 

In providing this advice, the Commission considered factors similar to those considered by the SEC when it 

issues waivers of disqualification under Regulation D and Regulation A. The SEC grants waivers where an applicant 

has shown "good cause and ... if the [SEC] determines that it is not necessary under the circumstances that the 

exemptions be denied," 17 C.F.R. §§ 230.262(b)(2), 230.506(d)(2)(ii), based on its analysis of how the identified 

misconduct bears on the applicant's fitness to participate in offerings exempted under Regulation D and Regulation A. 

See SEC, Div. of Corp. Fin., Waivers of Disqualification Under Regulation A and Rules 505 and 506 of Regulation D, 

https://www.sec.gov/divisions/corpfin/guidance/disqualification-waivers.shtml; SEC, Div. of Corp. Fin., Rule 504 of 

Regulation D: A Small Entity Compliance Guide for Issuers, https://www.sec.gov/divisions/corpfin/guidance/rule504-

issuer-sma11-entity-compliance.html. The SEC considers the following primary factors in determining whether to 

grant a waiver request: (i) the nature of the violation and whether it involved the offer or sale of securities; (ii) 

whether the violation required scienter; (iii) who was responsible for the misconduct; (iv) what was the duration of the 

misconduct; (v) what remedial steps have been taken; and (vi) the impact on the party seeking a waiver and third 

parties if a waiver is denied. Respondent's Request Letter addressed these factors in the context of this Order. 

The Commission considers these factors in the context of the markets it regulates, and also takes into account whether 

it determined that a statutory disqualification under the Act should arise solely based on the misconduct found herein 

and leading to disqualification under Regulation A and Regulation D. The Commission is guided by waivers granted 

by the SEC in prior cases involving similar facts and circumstances. See, e.g., In re JPMorgan Chase Bank, N.A., 

Securities Act Release No. 9993, 2015 WL 9256636 (Dec. 18, 2015) (SEC order determining that good cause had 

been shown that it was not necessary to deny reliance on the exemption under Rule 506 of Regulation D, where 

disqualification had been triggered by a CFTC order relating to JPMCB' s failure to adequately disclose certain 

conflicts of interest to clients); In re UBS AG, Securities Act Release No. 9787, 2015 WL 2395516 (May 20, 2015) 

(SEC order determining that good cause had been shown that it was not necessary to deny reliance on the exemption 

under Rule 506, where disqualification had been triggered by a criminal guilty plea relating to FX benchmark 

manipulation and noting the entry of parallel CFTC orders); In re Barclays PLC, Securities Act Release No. 9786, 

2015 WL 2395515 (May 20, 2015) (SEC order determining that good cause had been shown that it was not necessary 

to deny reliance on the exemption under Rule 506 where disqualification had been triggered by a CFTC order relating 

to FX benchmark and ISDAFIX manipulation); see also, e.g., Piper Jaffray & Co., SEC No-Action Letter, 2015 WL 

4451053 (July 20, 2015) (SEC no-action letter determining that good cause had been show that it was not necessary to 

deny reliance on the exemptions under Regulation A and Rule 506 of Regulation D, where disqualification had been 

triggered by an SEC order, and applying the same factors to consideration of waiver for both exemptions) .. 

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