UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

COMMODITY FUTURES

TRADING COMMISSION,

Plaintiff,

v. 

DICHAO XIE,

Defendant.

Case No.: 23-cv-1947 

Hon. Jeremy C. Daniel

CONSENT ORDER FOR PERMANENT INJUNCTION, CIVIL MONETARY PENALTY

AND OTHER EQUITABLE RELIEF AGAINST DEFENDANT DICHAO XIE

I. INTRODUCTION

On March 28, 2023, Plaintiff Commodity Futures Trading Commission (“CFTC”) filed a 

Complaint against Defendant Dichao Xie seeking injunctive and other equitable relief, as well as 

the imposition of civil penalties, for violations of the Commodity Exchange Act (“Act”), 

7 U.S.C. §§ 1–26, and the Commission’s Regulations (“Regulations”) promulgated thereunder, 

17 C.F.R. pts. 1–190 (2022). 

II. CONSENTS AND AGREEMENTS

To effect settlement of all charges alleged in the Complaint against Defendant Dichao 

Xie without a trial on the merits or any further judicial proceedings, Defendant Dichao Xie: 

1. Consents to the entry of this Consent Order for Permanent Injunction, Civil 

Monetary Penalty, and Other Equitable Relief Against Defendant Dichao Xie (“Consent Order”);

2. Affirms that he has read and agreed to this Consent Order voluntarily, and that no 

promise, other than as specifically contained herein, or threat, has been made by the CFTC or 

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any member, officer, agent, or representative thereof, or by any other person, to induce consent 

to this Consent Order;

3. Acknowledges service of the summons and Complaint;

4. Admits the jurisdiction of this Court over him and the subject matter of this action 

pursuant to Section 6c of the Act, 7 U.S.C. § 13a-1;

5. Admits the jurisdiction of the CFTC over the conduct and transactions at issue in

this action pursuant to the Act;

6. Admits that venue properly lies with this Court pursuant to 7 U.S.C. § 13a-1(e);

7. Waives:

a. Any and all claims that he may possess under the Equal Access to Justice 

Act, 5 U.S.C. § 504 and 28 U.S.C. § 2412, and/or the rules promulgated 

by the Commission in conformity therewith, Part 148 of the Regulations, 

17 C.F.R. pt. 148 (2022), relating to, or arising from, this action;

b. Any and all claims that he may possess under the Small Business 

Regulatory Enforcement Fairness Act of 1996, Pub. L. No. 104-121, tit. II, 

§§ 201–253, 110 Stat. 847, 857–74 (codified as amended at 28 U.S.C. 

§ 2412 and in scattered sections of 5 U.S.C. and 15 U.S.C.), relating to, or 

arising from, this action;

c. Any claim of Double Jeopardy based upon the institution of this action or 

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

any other relief, including this Consent Order; and

d. Any and all rights of appeal from this action;

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8. For purposes of the waiver of any and all rights under the Equal Access to Justice 

Act and the Small Business Regulatory Enforcement Fairness Act of 1996, specified in 

paragraph 7, agrees that the Commission is the prevailing party in this action;

9. Consents to the continued jurisdiction of this Court over him for the purpose of 

implementing and enforcing the terms and conditions of this Consent Order and for any other 

purpose relevant to this action, even if Defendant now or in the future resides outside the 

jurisdiction of this Court;

10. Agrees that he will not oppose enforcement of this Consent Order on the ground, 

if any exists, that it fails to comply with Rule 65(d) of the Federal Rules of Civil Procedure and 

hereby waives any objection based thereon;

11. Agrees that neither he nor any of his agents or employees under his authority or 

control shall take any action or make any public statement denying, directly or indirectly, any 

allegation in the Complaint or the Findings of Fact or Conclusions of Law in this Consent Order, 

or creating or tending to create the impression that the Complaint and/or this Consent Order is

without a factual basis; provided, however, that nothing in this provision shall affect his:

(a) testimonial obligations, or (b) right to take legal positions in other proceedings to which the 

CFTC is not a party. Defendant shall comply with this agreement, and shall undertake all steps 

necessary to ensure that all of his agents and/or employees under his authority or control 

understand and comply with this agreement; 

12. Consents to the entry of this Consent Order without admitting or denying the 

allegations of the Complaint or any findings or conclusions in this Consent Order, except as to 

jurisdiction and venue, which he admits; 

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13. Consents to the use of the findings and conclusions in this Consent Order in this 

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

is a party or claimant, and agrees that they shall be taken as true and correct and be given 

preclusive effect therein, without further proof; 

14. Does not consent, however, to the use of this Consent Order, or the findings and 

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 

proceeding to enforce the terms of this Order; and

15. Agrees that no provision of this Consent Order shall in any way limit or impair 

the ability of any other person or entity to seek any legal or equitable remedy against Defendant

in any other proceeding.

III. FINDINGS OF FACT AND CONCLUSIONS OF LAW

The Court, being fully advised in the premises, finds that there is good cause for the entry 

of this Consent Order and that there is no just reason for delay. The Court therefore directs the 

entry of the following Findings of Fact, Conclusions of Law, permanent injunction and equitable 

relief pursuant to Section 6c of the Act, 7 U.S.C. § 13a-1, as set forth herein.

THE PARTIES AGREE AND THE COURT HEREBY FINDS:

A. Findings of Fact

16. Plaintiff Commodity Futures Trading Commission is an independent federal 

regulatory agency that is charged by Congress with administering and enforcing the Act and the 

Regulations.

17. Defendant Dichao Xie is an individual who resides in the People’s Republic of 

China. Defendant has never been registered with the Commission in any capacity.

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18. From December 2021 through March 2022 (“Relevant Period”), Defendant was 

employed as a quantitative trader at a large multinational corporation (“Employer A”). In 

connection with his duties as a quantitative trader, Defendant had access to Employer A’s 

options and futures positions and associated orders for feeder cattle.

19. As an employee, Defendant had a duty of trust and confidence to Employer A and 

owed Employer A a duty to act in its best interests, keep confidential Employer A’s material 

non-public information, and not misappropriate this information for his own financial or personal 

benefit.

20. Despite these duties, on 71 occasions between December 15, 2021 and March 21, 

2022, Defendant improperly used Employer A’s material non-public information to intentionally 

or recklessly execute transactions on feeder cattle futures and options through his personal 

trading account as a counterparty to Employer A.

21. These transactions generated a profit for Defendant of $178,075.

B. Conclusions of Law

Jurisdiction and Venue

22. This Court possesses jurisdiction over this action pursuant to 28 U.S.C. § 1331 

(codifying federal question jurisdiction) and 28 U.S.C. § 1345 (providing that U.S. district courts 

have original jurisdiction over civil actions commenced by the United States or by any agency 

expressly authorized to sue by Act of Congress). Section 6c(a) of the Act, 7 U.S.C. § 13a-1(a), 

provides that the CFTC may bring actions for injunctive relief or to enforce compliance with the 

Act or any rule, regulation, or order thereunder in the proper district court of the United States 

whenever it shall appear to the CFTC that any person has engaged, is engaging, or is about to 

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engage in any act or practice constituting a violation of any provision of the Act or any rule, 

regulation, or order thereunder.

23. Venue properly lies with this Court pursuant to 7 U.S.C. § 13a-1(e) because the 

acts and practices in violation of the Act occurred within this District.

Count I: Fraud

24. By the conduct described in paragraphs 18–21 above, in connection with contracts 

for future delivery on or subject to the rules of a registered entity, Defendant used or employed, 

or attempted to use or employ, a manipulative device, scheme, or artifice to defraud, and 

engaged, or attempted to engage, in acts, practices or courses of business, which operated or 

would operate as a fraud or deceit upon any person, by, among other things, intentionally or 

recklessly misappropriating Employer A’s material non-public information to trade against 

Employer A for his personal benefit in breach of a pre-existing duty to Employer A, in violation 

of Section 6(c)(1) of the Act, 7 U.S.C. § 9(1), and Regulation 180.1(a)(1) and (3), 17 C.F.R.

§ 180.1(a)(1), (3) (2022).

Count II: Fraud in Connection with Futures Trading

25. By the conduct described in paragraphs 18–21 above, in or in connection with any 

order to make, or the making of, any contract of sale of any commodity for future delivery, that 

was made, or to be made, on or subject to the rules of a designated contract market, for or on 

behalf of any other person, Defendant cheated and defrauded or attempted to cheat or defraud his 

employer by intentionally or recklessly misappropriating Employer A’s material non-public 

information to trade futures against Employer A for his personal benefit in breach of a preexisting duty to Employer A, in violation of Section 4b(a)(1)(A) and (C) of the Act, 7 U.S.C. 

§ 6b(a)(1)(A), (C). 

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Count III: Fraud in Connection with Options Trading

26. By the conduct described in paragraphs 18–21 above, in connection with an offer 

to enter into, the entry into, or confirmation of the execution of, a commodity option transaction, 

Defendant directly or indirectly cheated and defrauded or attempted to cheat and defraud, and 

willfully deceived or attempted to deceive, his employer by intentionally or recklessly 

misappropriating Employer A’s material non-public information to trade options against 

Employer A for his personal benefit in breach of a pre-existing duty to Employer A, in violation 

of Section 4c(b) of the Act, 7 U.S.C. § 6c(b), and Regulation 33.10(a) and (c), 17 C.F.R. 

§ 33.10(a), (c) (2022). 

Count IV: Fictitious Trades

27. By the conduct described in paragraphs 18–21 above, Defendant offered to enter 

into, entered into, or confirmed the execution of transactions that were fictitious trades of 

commodities for future delivery or options on such transactions, by intentionally or recklessly 

misappropriating Employer A’s material non-public information to trade options against 

Employer A for his personal benefit in breach of a pre-existing duty to Employer A, in violation 

of Section 4c(a)(1) and 4c(a)(2)(A)(ii) of the Act, 7 U.S.C. § 6c(a)(1), 6c(a)(2)(A)(ii). 

Count V: Noncompetitive Trades

28. By the conduct described in paragraphs 18–21 above, Defendant entered into 

purchases and sales of commodities for future delivery or options on such transactions by

intentionally or recklessly misappropriating Employer A’s material non-public information to 

trade options against Employer A for his personal benefit in breach of a pre-existing duty to 

Employer A, in violation of Regulation 1.38(a), 17 C.F.R. § 1.38(a) (2022).

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29. Unless restrained and enjoined by this Court, there is a reasonable likelihood that 

Defendant will continue to engage in the acts and practices alleged in the Complaint and in 

similar acts and practices in violation of the Act and Regulations. 

IV. PERMANENT INJUNCTION

IT IS HEREBY ORDERED THAT:

30. Based upon and in connection with the foregoing conduct, pursuant to Section 6c 

of the Act, 7 U.S.C. § 13a-1, Defendant is permanently restrained, enjoined and prohibited from 

directly or indirectly:

a. In connection with contracts for future delivery on or subject to the rules of a 

registered entity, (1) using or employing, or attempting to use or employ, 

manipulative devices, schemes, or artifices to defraud; (2) making, or attempting 

to make, untrue or misleading statements of a material fact; (3) omitting to state 

material facts necessary in order to make statements made not untrue or 

misleading; or (4) engaging, or attempting to engage, in acts, practices, or courses 

of business, which would operate or would operate as a fraud or deceit upon any 

person in connection with contracts of sale of a commodity in interstate 

commerce, in violation of Section 6(c)(1) of the Act, 7 U.S.C. § 9(1), and 

Regulation 180.1(a)(1) and (3), 17 C.F.R. § 180.1(a)(1), (3) (2022); 

b. In connection with the purchase or sale of a futures contract made on or subject to 

the rules of a designated contract market, (1) cheating or defrauding or attempting 

to cheat or defraud another person; or (2) willfully deceiving or attempting to 

deceive another person, in violation of Section 4b(a)(1)(A) and (C) of the Act, 

7 U.S.C. § 6b(a)(1)(A), (C);

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c. In connection with an offer to enter into, the entry into, the confirmation of the 

execution of, or the maintenance of, any commodity option transaction, 

(1) cheating or defrauding or attempting to cheat or defraud another person; or 

(2) willfully deceiving or attempting to deceive another person, in violation of 

Section 4c(b) of the Act, 7 U.S.C. § 6c(b), and Regulation 33.10(a) and (c), 

17 C.F.R. § 33.10(a), (c) (2022); and

d. In connection with the purchase or sale of any commodity for future delivery or 

any option on such a transaction or option on a commodity, offering to enter into, 

entering into, or confirming the execution of a fictitious sale, in violation of 

Section 4c(a)(1) and (2)(A)(ii) of the Act, 7 U.S.C. § 6c(a)(1), (2)(A)(ii), and 

Regulation 1.38(a), 17 C.F.R. § 1.38(a) (2022).

31. Defendant is also restrained, enjoined and prohibited, for a period of five years,

from directly or indirectly: 

a. Trading on or subject to the rules of any registered entity (as that term is 

defined in Section 1a(40) of the Act, 7 U.S.C. § 1a(40));

b. Entering into any transactions involving “commodity interests” (as that 

term is defined in Regulation 1.3, 17 C.F.R. § 1.3 (2022)), for his own 

personal account or for any account in which he has a direct or indirect 

interest; 

c. Having any commodity interests traded on his behalf; 

d. Controlling or directing the trading for or on behalf of any other person or 

entity, whether by power of attorney or otherwise, in any account 

involving commodity interests; 

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e. Soliciting, receiving, or accepting any funds from any person for the 

purpose of purchasing or selling any commodity interests; 

f. Applying for registration or claiming exemption from registration with the 

Commission in any capacity, and engaging in any activity requiring such 

registration or exemption from registration with the Commission, except 

as provided for in Regulation 4.14(a)(9), 17 C.F.R. § 4.14(a)(9) (2022); 

and

g. Acting as a principal (as that term is defined in Regulation 3.1(a), 

17 C.F.R. § 3.1(a) (2022)), agent or any other officer or employee of any 

person (as that term is defined in Section 1a(38) of the Act, 7 U.S.C. 

§ 1a(38)), registered, exempted from registration or required to be 

registered with the Commission except as provided for in 17 C.F.R. 

§ 4.14(a)(9).

V. RESTITUTION, DISGORGEMENT, AND CIVIL MONETARY PENALTY 

A. Disgorgement

32. Defendant shall pay disgorgement in the amount of one hundred seventy-five

thousand, seven hundred seventy-two dollars and forty cents ($175,772.40) (“Disgorgement 

Obligation”), representing the gains received in connection with such violations, within thirty

days of the date of the entry of this Consent Order. If the Disgorgement Obligation is not paid in 

full within thirty days of the date of entry of this Consent Order, then post-judgment interest 

shall accrue on the unpaid portion of the Disgorgement Obligation beginning on the date of entry 

of this Consent Order and shall be determined by using the Treasury Bill rate prevailing on the 

date of entry of this Consent Order pursuant to 28 U.S.C. § 1961.

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33. Defendant shall pay his Disgorgement Obligation and any post-judgment interest

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:

MMAC/ESC/AMK326

Commodity Futures Trading Commission

6500 S. MacArthur Blvd.

HQ Room 266

Oklahoma City, OK 73169

9-amz-ar-cftc@faa.gov

If payment by electronic funds transfer is chosen, Defendant shall contact Tonia King or her 

successor at the address above to receive payment instructions and shall fully comply with those 

instructions. Defendant shall accompany payment of the Disgorgement Obligation with a cover 

letter that identifies Defendant and the name and docket number of this proceeding. Defendant

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.

B. Civil Monetary Penalty

34. Defendant shall pay a civil monetary penalty in the amount of one hundred

seventy-five thousand, seven hundred seventy-two dollars and forty cents ($175,772.40) (“CMP 

Obligation”), within thirty days of the date of the entry of this Consent Order. If the CMP 

Obligation is not paid in full within thirty days of the date of entry of this Consent Order, then 

post-judgment interest shall accrue on the unpaid portion of the CMP Obligation beginning on 

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

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

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35. Defendant shall pay his CMP Obligation and any post-judgment interest, 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: 

MMAC/ESC/AMK326

Commodity Futures Trading Commission 

6500 S. MacArthur Blvd. 

HQ Room 266 

Oklahoma City, OK 73169 

9-amz-ar-cftc@faa.gov

If payment by electronic funds transfer is chosen, Defendant shall contact Tonia King or her 

successor at the address above to receive payment instructions and shall fully comply with those 

instructions. Defendant shall accompany payment of the CMP Obligation with a cover letter that 

identifies Defendant and the name and docket number of this proceeding. Defendant 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. Provisions Related to Monetary Sanctions 

36. Partial Satisfaction: Acceptance by the CFTC of any partial payment of 

Defendant’s Disgorgement Obligation or CMP Obligation shall not be deemed a waiver of his 

obligation to make further payments pursuant to this Consent Order, or a waiver of the CFTC’s 

right to seek to compel payment of any remaining balance.

VI. MISCELLANEOUS PROVISIONS

37. Until such time as Defendant satisfies in full his Disgorgement Obligation and 

CMP Obligation under this Consent Order, upon the commencement by or against Defendant of 

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insolvency, receivership, or bankruptcy proceedings or any other proceedings for the settlement

of Defendant’s debts, all notices to creditors required to be furnished to the CFTC under Title 11 

of the United States Code or other applicable law with respect to such insolvency, receivership

bankruptcy or other proceedings, shall be sent to the address below: 

Secretary of the Commission

Office of the General Counsel

Commodity Futures Trading Commission 

Three Lafayette Centre 

1155 21st Street N.W. 

Washington, DC 20581 

38. Notice: All notices required to be given by any provision in this Consent Order, 

except as set forth in paragraph 37, above, shall be sent certified mail, return receipt requested, as 

follows: 

Robert T. Howell 

Deputy Director, Division of Enforcement 

Commodity Futures Trading Commission 

77 W Jackson Blvd., Suite 800 

Chicago, IL 60604

All such notices to the CFTC shall reference the name and docket number of this action.

39. Change of Address/Phone: Until such time as Defendant satisfies in full his

Disgorgement Obligation and CMP Obligation as set forth in this Consent Order, Defendant

shall provide written notice to the CFTC by certified mail of any change to his telephone number 

or mailing address within ten calendar days of the change. 

40. Entire Agreement and Amendments: This Consent Order incorporates all of the 

terms and conditions of the settlement among the parties hereto to date. Nothing shall serve to 

amend or modify this Consent Order in any respect whatsoever, unless: (a) reduced to writing; 

(b) signed by all parties hereto; and (c) approved by order of this Court. 

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41. Invalidation: If any provision of this Consent Order or if the application of any 

provision or circumstance is held invalid, then the remainder of this Consent Order and the 

application of the provision to any other person or circumstance shall not be affected by the 

holding.

42. Waiver: The failure of any party to this Consent Order at any time to require 

performance of any provision of this Consent Order shall in no manner affect the right of the

party at a later time to enforce the same or any other provision of this Consent Order. No waiver 

in one or more instances of the breach of any provision contained in this Consent Order shall be 

deemed to be or construed as a further or continuing waiver of such breach or waiver of the 

breach of any other provision of this Consent Order.

43. Waiver of Service, and Acknowledgement: Defendant waives service of this 

Consent Order and agrees that entry of this Consent Order by the Court and filing with the Clerk 

of the Court will constitute notice to the Defendant of its terms and conditions. 

44. Continuing Jurisdiction of this Court: This Court shall retain jurisdiction of this 

action to ensure compliance with this Consent Order and for all other purposes related to this 

action, including any motion by Defendant to modify or for relief from the terms of this Consent 

Order.

45. Injunctive and Equitable Relief Provisions: The injunctive and equitable relief 

provisions of this Consent Order shall be binding upon the following persons who receive actual 

notice of this Consent Order, by personal service or otherwise: (1) Defendant; (2) any officer, 

agent, servant, employee, or attorney of Defendant; and (3) any other persons who are in active 

concert or participation with any persons described in subsections (1) and (2) above.

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46. Counterparts and Facsimile Execution: This Consent Order may be executed in 

two or more counterparts, all of which shall be considered one and the same agreement and shall 

become effective when one or more counterparts have been signed by each of the parties hereto 

and delivered (by facsimile, email, or otherwise) to the other party, it being understood that all 

parties need not sign the same counterpart. Any counterpart or other signature to this Consent 

Order that is delivered by any means shall be deemed for all purposes as constituting good and 

valid execution and delivery by such party of this Consent Order.

47. Contempt: Defendant understands that the terms of the Consent Order are 

enforceable through contempt proceedings to the fullest extent of applicable law, and that, in any 

such proceedings, he may not challenge the validity of this Consent Order.

48. Agreements and Undertakings: Defendant shall comply with all of the 

undertakings and agreements set forth in this Consent Order.

There being no just reason for delay, the Clerk of the Court is hereby ordered to enter this 

Consent Order for Permanent Injunction, Civil Monetary Penalty, and Other Equitable Relief 

Against Defendant Dichao Xie forthwith and without further notice.

IT IS SO ORDERED on this 26th day of September, 2023.

_________________________________

JEREMY C. DANIEL

UNITED STATES DISTRICT JUDGE

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CONSENTED TO AND APPROVED BY:

___________________________________ 

Dichao Xie

52 Luoshanzhong Lu, Linshan, Yuyao 

Zhejiang Province, 315460 

China

Date: ___________________ 

/s Benjamin E. Sedrish 

Benjamin E. Sedrish 

Allison V. Passman

Commodity Futures Trading 

Commission

77 W Jackson Blvd., Suite 800 

Chicago, IL 60604 

Tel. (312) 596-0700 

Fac. (312) 596-0714 

bsedrish@cftc.gov 

apassman@cftc.gov

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