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WASHINGTON, Sept 14 (Reuters) - The U.S. futures regulator said on Tuesday that Vitol SA [VITOLV.UL] will pay $6 million to settle charges that two of its affiliates mislead the New York Mercantile Exchange about their close relationship.
The U.S. Commodity Futures Trading Commission said Houston-based Vitol and Vitol Capital Management Ltd, located in Bermuda, failed to disclose to NYMEX their relationship and shared sensitive information. Both are affiliated with the Vitol SA, headquartered in Geneva, one of the world’s biggest energy traders.
CFTC said the two firms learned in June 2007 that NYMEX misperceived the relationship between the two companies, but failed to correct the misperception. NYMEX is now owned by CME Group Inc (CME.O).
The lack of necessary information prevented NYMEX/CME from being able to aggregate the positions of the two firms in order to correctly apply position limits and accountability levels. CFTC said the problem was corrected in March 2009.
“Instead of correcting the NYMEX’s misperception, VIC and VCM implemented only limited barriers to prevent the flow of trading information between them,” CFTC said.
Vitol said in a statement the agreement brings to a close the CFTC’s investigations of the company and its affiliates.
“We are pleased to have reached a resolution to this matter on terms acceptable to all parties,” said a Vitol spokesperson. “Since 2007 we have put in place a new compliance organisation, staffed by experienced compliance professionals, as well as the necessary processes and procedures.” (Editing by David Gregorio)