The Commodity Futures Trading Commission (CFTC) revealed Monday that it has ordered NinjaTrader Clearing, LLC dba NinjaTrader, Tradovate and TransAct Futures (NTC), a registered Futures Commission Merchant (FCM), to pay over $980,000 for failing to adequately supervise its employees’ handling of customer accounts.
NinjaTrader Ordered to Pay Over $980,000 for Supervision Failures
The CFTC found that NinjaTrader, which operates out of Deer Park, Illinois, failed to implement sufficient policies and procedures to manage accounts in emergency situations, particularly in response to a statutory restraining order issued in a previous fraud case.
It is also alleged to have not exercised sufficient oversight over its employees’ handling of accounts.
This oversight led to significant losses for customers whose accounts were not properly frozen or restricted.
“The CFTC order finds that from at least Dec. 31, 2020, to the present, NTC failed to diligently supervise its employees’ handling of accounts that needed to be frozen, disabled, or otherwise restricted on an emergency basis,” said the CFTC.
The CFTC highlights one case in January 2022, where they state that NinjaTrader “failed to diligently supervise its employees’ handling of accounts NTC held or managed under the name Rajiv Patel.”
As a result of these deficiencies, NinjaTrader was ordered to pay a $750,000 civil monetary penalty, cease and desist from future violations, and provide restitution of $233,425 “to the victims of the fraud prosecuted in that action.”
“NTC failed to take diligent steps to understand and implement the SRO. These failures resulted in positions in the Patel accounts remaining open for several days after the SRO was served, during which time they lost more than $200,000 in value,” concluded the CFTC.
