Fine And Other Sanctions Imposed On Former Managing Director Of Bank Of Montreal’s Commodity Derivatives Group

Robert Moore, former executive managing director for the Bank of Montreal’s (BMO) Commodity Derivatives Group, has entered into a consent order with the U.S. Commodity Futures Trading Commission relating to allegations of mis-marking and mis-valuing BMO’s natural gas options book by the trader he supervised. 

The federal court order requires Moore to pay a $150,000 civil monetary penalty within 10 days. The order also permanently prohibits Moore from engaging in any conduct in violation of the Commodity Exchange Act and/or CFTC regulations concerning any commodity options transaction.
 
The order stems from a CFTC complaint filed on November 18, 2008 that charged David P. Lee with unlawfully mis-marking his natural gas options positions between at least May 2003 and May 2007 and with mis-valuing other natural gas options positions from October 2006 until May 2007. The complaint further charged that Lee and various brokers deceived BMO by fabricating purportedly independent broker quotes delivered to BMO’s back office for price and skew verification. The complaint alleged that such conduct violated the anti-fraud and false reporting provisions of the Commodity Exchange Act and CFTC regulations.
 
Moore was Lee’s direct supervisor at BMO and was charged with controlling person liability for Lee’s violations. Lee settled the action against him in November 2009.