X-Change Financial Access, LLC (XFA) has agreed to pay a $130,000 fine as part of a settlement with Cboe Exchange, Inc.
During the Review Period (from March 2023 to March 2024 on or about March 2024), XFA failed to promptly and/or continuously represent customer orders marked “Held”. Specifically, the company failed to represent directly and/or permanently at least 24,859 orders.
This conduct constitutes a violation of Exchange Rule 5.91 by the firm in that the firm failed to handle “held” orders with due diligence.
During the review period, XFA had written Supervisory Procedures (“WSPs”) in place that set out its obligations to comply with Cboe’s due diligence rules, but these WSPs do not detail how the firm actually reviews and ensures compliance with these rules.
This conduct constitutes a violation of Exchange Rule 8.16 by the firm in that the firm failed to establish, maintain and enforce a WSP, and a system for implementing such procedures, reasonably designed to prevent and detect violations of the Rule 5.91 of the Cboe requiring the submission of orders are treated with due diligence.
XFA has no prior relevant disciplinary history specifically related to due diligence violations.
In light of the alleged rule violations, the XFA consents to a reprimand and a $130,000 fine.