Pursuant to Regulation 1.55 in Part 1 of the Commodity Exchange Act, the Commodity Futures Trading Commission requires that each futures commission merchant provide specific disclosure documents that are intended to explain the risks of opening a commodity futures account in general and to provide information that would be material to a customer's decision to entrust funds to and to do business with a particular futures commission merchant. The information below addresses these requirements.
Financial information regarding the Company, including how the Company invests and holds customer funds, can be found on the NFA website at http://www.nfa.futures.org/basicnet/welcome.aspx
Financial information for all FCMs can be found on the CFTC website at http://www.cftc.gov/.
CHS Hedging provides individualized consulting and education in the areas of agriculture, energy and crop nutrients.. The Energy Risk Management Program puts dedicated energy market expertise to work for commercial energy business. The Crop Nutrient Risk Management Program delivers consultation for crop nutrient dealers and retailers, with a special emphasis on inventory and risk management strategies. CHS Hedging uses approximately 0.8% of its assets and 0% of its net capital for consulting and education
CHS Hedging’s customers primarily trade in the agriculture and energy markets. The Company clears grain trades directly at CME Group exchanges, including the Chicago Mercantile Exchange (CME), Chicago Board of Trade (CBOT), New York Mercantile Exchange (NYMEX) and the Minneapolis Grain Exchange (MGEX). For the clearing of other products, the Company utilizes R. J. O’Brien & Associates, LLC as a carry broker. The Company requires that FCMs meet certain criteria with regard to capitalization, access to liquidity, creditworthiness, concentration and regulatory and supervisory compliance.
The Chicago Board of Trade, part of CME Group, Inc., is the DSRO for CHS Hedging. The web address is www.cmegroup.com.
Information about filing a complaint can be found at:
The following items can be found at www.chshedging.com/financial-statements:
Financial information regarding the Company, including how the Company invests and holds customer funds, can be found on the NFA website at http://www.nfa.futures.org/basicnet/welcome.aspx.
Financial information for all FCMs can be found on the CFTC website at https://www.cftc.gov/MarketReports/financialfcmdata/index.htm.
Margin is a good faith deposit for the performance of commodity interest contracts. Your margin obligation as a customer and CHS Hedging's rights with respect to margin are set forth in the Futures Customer Agreement. Set forth below is a general description of CHS Hedging's policy with respect to margins.
Margin requirements established by CHS hedging may exceed the margin required by an exchange. Additionally, CHS Hedging may increase or decrease margin requirements by any amount in its sole discretion and at any time without advance notice to you.
Customers must make margin deposits when and as demanded by CHS Hedging and must satisfy immediately all margin calls in such manner as CHS Hedging shall designate in its sole discretion. Customers will be required to wire funds for any margin call which is $10,000 or greater.* Until the required margin deposit has been received, it is CHS Hedging's policy not to permit any customer to withdraw funds from their account, even in the case of favorable market movement.
Failure to promptly satisfy a margin call may preclude a customer from initiating new positions and may result in the liquidation and closing out of all or some of the customer's positions without prior notice to you. Any liquidation or related action by CHS Hedging does not release you from any liability previously incurred. In the event liquidation proceeds are insufficient for the payment of all liabilities, the customer shall promptly, upon demand, pay to CHS Hedging the deficit and all unpaid liabilities and damages, together with interest thereon and all costs of collection, including reasonable attorney's fees.
Customers may use one of the following methods to meet margin calls:
IMPORTANT NOTE: The legal name on the originating bank account being used to satisfy a margin call must match the legal name on the CHS Hedging account to which the funds are being credited. All checks and funds to be credited to a CHS Hedging account must be payable only to CHS Hedging. All deposits will be deemed made when cleared funds are actually received by CHS Hedging. If a check is not honored or paid by a bank upon presentment, CHS Hedging will immediately debit the account for the amount of the returned check as well as any fees incurred. CHS Hedging cannot accept cash or credit cards for payment of margin calls.
Security Loan Agreement: Third-party loan agreements between a customer, CHS Hedging and the customer's bank are available. For more information, contact our Compliance Department at 800-814-0505.
*A customer may be allowed to replace a wire transfer with an ACH under certain pre-approved circumstances.
In the event of any conflict between this Margin Policy and the Futures Customer Agreement, the Futures Customer Agreement shall prevail and control.
Disclosure of Futures Commission Merchant Material Conflicts of Interest
The purpose of this document is to provide you with information about some of the material conflicts of interest that may arise between you and CHS Hedging LLC. in connection with CHS Hedging LLC. performing services for you with respect to the futures, options on futures, swaps (as defined by the Commodity Exchange Act), forwards or other commodity derivatives (“Contracts”). Conflicts of interests can arise in particular when CHS Hedging LLC. has an economic or other incentive to act, or persuade you to act, in a way that favors CHS Hedging LLC. or its affiliates.
Under applicable law, including regulations of the Commodity Futures Trading Commission (“CFTC”), not all swaps are required to be executed on an exchange or swap execution facility (each, a “Trading Facility”), even if a Trading Facility lists the swap for trading. In such circumstances, it may be financially advantageous for CHS Hedging LLC. or its affiliate to execute a swap with you bilaterally in the over-the-counter market rather than on a Trading Facility and, to the extent permitted by applicable law, we may have an incentive to persuade you to execute your swap bilaterally.
Applicable law may permit you to choose the CFTC-registered derivatives clearing organization (“Clearing House”) to which you submit a swap for clearing. You should be aware that CHS Hedging LLC. may not be a member of, or may not otherwise be able to submit your swap to, the Clearing House of your choice. CHS Hedging LLC. consequently has an incentive to persuade you to use a Clearing House of which CHS Hedging LLC. or its affiliate is a member.
You also should be aware that CHS Hedging LLC. or its affiliate may own stock in, or have some other form of ownership interest in, one or more U.S. or foreign Trading Facilities or Clearing Houses where your transactions in Contracts may be executed and/or cleared. As a result, CHS Hedging LLC. or its affiliate may receive financial or other benefits related to its ownership interest when Contracts are executed on a given Trading Facility or cleared through a given Clearing House, and CHS Hedging LLC would, in such circumstances, have an incentive to cause Contracts to be executed on that Trading Facility or cleared by that Clearing House. In addition, employees and officers of CHS Hedging LLC. or its affiliate may also serve on the board of directors or on one or more committees of a Trading Facility or Clearing House.
In addition, Trading Facilities and Clearing Houses may from time to time have in place other arrangements that provide their members or participants with volume, market-making or other discounts or credits, may call for members or participants to pre-pay fees based on volume thresholds, or may provide other incentive or arrangements that are intended to encourage market participants to trade on or direct trades to that Trading Facility or Clearing House. CHS Hedging LLC. or its affiliate may participate in and obtain financial benefits from such incentive programs.
When we provide execution services to you (either in conjunction with clearing services or in an execution-only capacity), we may direct orders to affiliated or unaffiliated market-makers, other executing firms, individual brokers or brokerage groups for execution. When such affiliated or unaffiliated parties are used, they may, where permitted, agree to price concessions, volume discounts or refunds, rebates or similar payment in return for receiving such business. Likewise, where permitted by law and the rules of the applicable Trading Facility, we may solicit a counterparty to trade opposite your order or enter into transactions for its own account or the account of other counterparties that may, at times, be adverse to your interests in a Contract. In such circumstances, that counterparty may make payments and/or pay a commission to CHS Hedging LLC. in connection with that transaction. The results of your transactions may differ significantly from the results achieved by us for our own account, our affiliates, or for other customers.
In addition, where permitted by applicable law (including, where applicable, the rules of the applicable Trading Facility), CHS Hedging LLC., its directors, officers, employees and affiliates may act on the other side of your order or transaction by the purchase or sale for an account, or the execution of a transaction with a counterparty, in which CHS Hedging LLC. or a person affiliated with CHS Hedging LLC. has a direct or indirect interest, or may effect any such order with a counterparty that provides CHS Hedging LLC. or its affiliates with discounts related to fees for Contracts or other products. In cases where we have offered you a discounted commission or clearing fee for Contracts executed through CHS Hedging LLC. as agent or with CHS Hedging LLC. or its affiliate acting as counterparty, CHS Hedging LLC. or its affiliate may be doing so because of the enhanced profit potential resulting from acting as executing broker or counterparty.CHS Hedging LLC or its affiliate may act as, among other things, an investor, research provider, placement agent, underwriter, distributor, remarketing agent, structurer, securitizer, lender, investment manager, investment adviser, commodity trading advisor, municipal advisor, market maker, trader, prime broker or clearing broker. In those and other capacities, CHS Hedging LLC, its directors, officers, employees and affiliates may take or hold positions in, or advise other customers and counterparties concerning, or publish research or express a view with respect to, a Contract or a related financial instrument that may be the subject of advice from us to you. Any such positions and other advice may not be consistent with, or may be contrary to, your interests or positions which are the subject of advice previously provided by CHS Hedging LLC or its affiliate to you, and unless otherwise disclosed in writing, we are not necessarily acting in your best interest and are not assessing the suitability for you of any Contract or related financial instrument. Acting in one or more of the capacities noted above may give CHS Hedging LLC or its affiliate access to information relating to markets, investment and products. As a result, CHS Hedging LLC or its affiliate may be in possession of information which, if know to you, might cause you to seek to dispose of, retain or increase your position in one or more Contracts or other financial instruments. CHS Hedging LLC and its affiliate will be under no duty to make any such information available to you, except to the extent we have agreed in writing or as may be required under applicable law.
Affiliate Risk – CHS Inc., the parent of CHS Hedging and other affiliates, is a cooperative that engages in a variety of business activities relating to energy, grains and foods. Operations include refineries, rural retail locations, processing, marketing, and distribution.
Counterparty Risk – A customer, clearinghouse or FCM may fail to meet its obligations to CHS Hedging or other industry participants. The Company has contributed to the guaranty funds of the CME Group and the Minneapolis Grain Exchange. In the event of a default, the guaranty deposits may be accessed to cover unpaid obligations of the defaulting party.
Regulatory Risk – The regulations governing the FCM industry are subject to change. CHS Hedging is committed to maintaining compliance with the rules and engages with regulators, industry groups and other FCMs to provide input regarding proposed rulemaking. Regulatory changes may affect the Company’s ability to maintain its current structure and profitability.
Liquidity & Capital Risk – CHS Hedging obtains liquidity and capital exclusively from CHS Inc. and/or affiliates on an as needed basis. As such, the Company is dependent on the creditworthiness of the parent to ensure that adequate funds are available in case of need. CHS has one or more lines of credit with a consortium of banks that impose specific covenants in order to maintain the financial health of CHS Inc. and the safety of the banks’ investments. A breach of the covenants or other catastrophic financial failure of the parent could have a material effect on the Company’s access to liquidity and capital.
Leverage & Liability Risk – The regulatory leverage risk of the Company is primarily driven by the proprietary trading of the parent and affiliates for the purpose of hedging commodity and other business-related risks. CHS Hedging does not itself maintain a proprietary position. If the business attributable to the parent and affiliates rises, there may be additional risk to the Company’s balance sheet if a substantially material event occurs with the parent or an affiliate. Other than proprietary trading, the Company may also carry an intercompany net payable to the parent for settlement of various payables and receivables.
Enforcement complaints or actions filed against CHS Hedging can be accessed on the National Futures Association’s website at: https://www.nfa.futures.org/basicnet (see CHS Hedging, LLC, Firm NFA ID #0192593).
When trading in the futures markets, there are risks if the market moves against your futures positions. These risks may be particularly acute in those instances in which a futures contract settles at a negative price. The circumstances that lead a futures contract to settle at a negative price may vary. One example of when a futures contract with a physical commodity as the underlying asset may settle at a negative price, is when the supply of the commodity faces physical constraints in distribution or storage to such an extent that some suppliers are prepared to pay others to physically take away the commodity. Futures contracts across other asset classes may also settle at negative prices for any number of reasons. Regardless of whether prices are positive or negative, you should keep in mind that if the market moves against your futures positions:
You should contact the compliance department or your broker if you have questions or want additional information.
The business address for all principals is 5500 Cenex Drive, Inver Grove Heights, MN 55077.
Joe Barker, Director of Commercial Brokerage Services, CHS Hedging LLC.
Joe has spent 16 years providing commodity price risk management services for agricultural clients of CHS Hedging. He began in the Indianapolis branch office as a commodity broker in 2000. From 2007 to 2014, he was the branch manager of the Kansas City office and spent the several years in the Indianapolis office. Joe served on the Kansas City of Board of Trade and was on the KCBT Clearing Corporation Board of Directors while in Kansas City. He serves on an ad hoc committee for the National Council of Farmer Cooperatives as well as the Ag Advisory Committee for the CFTC. Joe provides industry perspective and policy feedback to the CFTC during its rule-making process related to implementation of the Dodd-Frank Act.
Sean O’Toole, Director of Commodity Brokerage, CHS Hedging LLC.
Sean oversees the Compass structured products program, dairy and livestock hedging, and professional trade execution services for CHS Hedging. He has 27 years of experience in the commodities industry including time spent in risk management, futures brokerage, and trading. He is a past member of the Minneapolis Grain Exchange, the Kansas City Board of Trade, and is currently a member of the Chicago Board of Trade. He was managing director of FC Stone Trading LLC overseeing over-the-counter trading arm of INTL FC Stone, Inc.
Tony Headrick, Director of Commodity Brokerage, CHS Hedging LLC.
Tony Headrick specializes in energy, fertilizer and specialty products risk management. Headrick leads of team of commodity brokers that help commercial agribusinesses and other industry partners mitigate risk and achieve their financial goals through expert market and risk management consultation. Prior to joining CHS Hedging in 2013, Headrick was a refined fuels account manager in the energy division of CHS Inc. In addition to his energy and commodity brokerage experience, Headrick has experience in the lumber and millwork industry. He holds bachelor’s degrees in international business and marketing from St. Mary’s University in Winona, Minnesota.
Rob Runchey Director of Finance Chief Financial Officer, CHS Hedging LLC.
Rob Runchey has more than 20 years of experience in global finance including roles in treasury, financial planning and analysis, SEC reporting, internal audit and public accounting. This includes roles at The Mosaic Company, G&K Services and RSM. A certified public accountant, Rob holds a bachelor’s degree in accounting from the University of Northern Iowa and an MBA from the University of Minnesota.
The risk of loss in trading commodity futures contracts can be substantial. You should, therefore, carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should be aware of the following points:
1. You may sustain a total loss of the funds that you deposit with your broker to establish or maintain a position in the commodity futures market, and you may incur losses beyond these amounts. If the market moves against your position, you may be called upon by your broker to deposit a substantial amount of additional margin funds, on short notice, in order to maintain your position. If you do not provide the required funds within the time required by your broker, your position may be liquidated at a loss, and you will be liable for any resulting deficit in your account.
2. The funds you deposit with a futures commission merchant for trading futures positions are not protected by insurance in the event of the bankruptcy or insolvency of the futures commission merchant, or in the event your funds are misappropriated.
3. The funds you deposit with a futures commission merchant for trading futures positions are not protected by the Securities Investor Protection Corporation even if the futures commission merchant is registered with the Securities and Exchange Commission as a broker or dealer.
4. The funds you deposit with a futures commission merchant are generally not guaranteed or insured by a derivatives clearing organization in the event of the bankruptcy or insolvency of the futures commission merchant, or if the futures commission merchant is otherwise unable to refund your funds. Certain derivatives clearing organizations, however, may have programs that provide limited insurance to customers. You should inquire of your futures commission merchant whether your funds will be insured by a derivatives clearing organization and you should understand the benefits and limitations of such insurance programs.
5. The funds you deposit with a futures commission merchant are not held by the futures commission merchant in a separate account for your individual benefit. Futures commission merchants commingle the funds received from customers in one or more accounts and you may be exposed to losses incurred by other customers if the futures commission merchant does not have sufficient capital to cover such other customers' trading losses.
6. The funds you deposit with a futures commission merchant may be invested by the futures commission merchant in certain types of financial instruments that have been approved by the Commission for the purpose of such investments. Permitted investments are listed in Commission Regulation 1.25 and include: U.S. government securities; municipal securities; money market mutual funds; and certain corporate notes and bonds. The futures commission merchant may retain the interest and other earnings realized from its investment of customer funds. You should be familiar with the types of financial instruments that a futures commission merchant may invest customer funds in.
7. Futures commission merchants are permitted to deposit customer funds with affiliated entities, such as affiliated banks, securities brokers or dealers, or foreign brokers. You should inquire as to whether your futures commission merchant deposits funds with affiliates and assess whether such deposits by the futures commission merchant with its affiliates increases the risks to your funds.
8. You should consult your futures commission merchant concerning the nature of the protections available to safeguard funds or property deposited for your account.
9. Under certain market conditions, you may find it difficult or impossible to liquidate a position. This can occur, for example, when the market reaches a daily price fluctuation limit (“limit move”).
10. All futures positions involve risk, and a “spread” position may not be less risky than an outright “long” or “short” position.
11. The high degree of leverage (gearing) that is often obtainable in futures trading because of the small margin requirements can work against you as well as for you. Leverage (gearing) can lead to large losses as well as gains.
12. In addition to the risks noted in the paragraphs enumerated above, you should be familiar with the futures commission merchant you select to entrust your funds for trading futures positions. The Commodity Futures Trading Commission requires each futures commission merchant to make publicly available on its Web site firm specific disclosures and financial information to assist you with your assessment and selection of a futures commission merchant. Information regarding this futures commission merchant may be obtained by visiting our Web site, www.chshedging.com.
Variable degree of risk
13. Transactions in options carry a high degree of risk. Purchasers and seller of options should familiarize themselves with the type of option (i.e., put or call) which they contemplate trading and the associated risks. You should calculate the extent to which the value of the options must increase for your position to become profitable, taking into account the premium and all transaction costs.
14. The purchaser of options may offset or exercise the options or allow the options to expire. The exercise of an option results either in a cash settlement or in the purchaser acquiring or delivering the underlying interest. If the option is on a future, the purchaser will acquire a futures position with associated liabilities for margin (see the section on Futures above). If the purchased options expire worthless, you will suffer a total loss of your investment which will consist of the option premium plus transaction costs. If you are contemplating purchasing deep-out-of-the-money options, you should be aware that the chance of such options becoming profitable is ordinarily remote.
15. Selling ('writing' or 'granting') an option generally entails considerably greater risk than purchasing options. Although the premium received by the seller is fixed, the seller may sustain a loss well in excess of that amount. The seller will be liable for additional margin to maintain the position if the market moves unfavorably. The seller will also be exposed to the risk of the purchaser exercising the option and the seller will be obligated to either settle the option in cash or to acquire or deliver the underlying interest. If the option is on a future, the seller will acquire a position in a future with associated liabilities for margin (see the section on Futures above). If the position is 'covered' by the seller holding a corresponding position in the underlying interest or a future or another option, the risk may be reduced. If the option is not covered, the risk of loss can be unlimited.
16. Certain exchanges in some jurisdictions permit deferred payment of the option premium, exposing the purchaser to liability for margin payments not exceeding the amount of the premium. The purchaser is still subject to the risk of losing the premium and transaction costs. When the option is exercised or expires, the purchaser is responsible for any unpaid premium outstanding at that time.
ADDITIONAL RISKS COMMON TO FUTURES AND OPTIONS Terms and conditions of contracts
17. You should ask the firm with which you deal about the term and conditions of the specific futures or options which you are trading and associated obligations (e.g., the circumstances under which you may become obligated to make or take delivery of the underlying interest of a futures contract and, in respect of options, expiration dates and restrictions on the time for exercise). Under certain circumstances the specifications of outstanding contracts (including the exercise price of an option) may be modified by the exchange or clearing house to reflect changes in the underlying interest.
Suspension or restriction of trading and pricing relationships
18. Market conditions (e.g., illiquidity) and/or the operation of the rules of certain markets (e.g., the suspension of trading in any contract or contract month because of price limits or 'circuit breakers') may increase the risk of loss by making it difficult or impossible to effect transactions or liquidate/offset positions. If you have sold options, this may increase the risk of loss.
19. Further, normal pricing relationships between the underlying interest and the future, and the underlying interest and the option may not exist. This can occur when, for example, the futures contract underlying the option is subject to price limits while the option is not. The absence of an underlying reference price may make it difficult to judge 'fair' value.
Deposited cash and property
20. You should familiarize yourself with the protections accorded money or other property you deposit for domestic and foreign transactions, particularly in the event of a firm insolvency or bankruptcy. The extent to which you may recover your money or property may be governed by specified legislation or local rules. In some jurisdictions, property which has been specifically identifiable as your own will be pro-rated in the same manner as cash for purposes of distribution in the event of a shortfall.
Commission and other charges
21. Before you begin to trade, you should obtain a clear explanation of all commission, fees and other charges for which you will be liable. These charges will affect your net profit (if any) or increase your loss.
22. The profit or loss in transactions in foreign currency-denominated contracts (whether they are traded in your own or another jurisdiction) will be affected by fluctuations in currency rates where there is a need to convert from the currency denomination of the contract to another currency.
23. Most open-outcry and electronic trading facilities are supported by computerbased component systems for the order-routing, execution, matching, registration or clearing of trades. As with all facilities and systems, they are vulnerable to temporary disruption or failure. Your ability to recover certain losses may be subject to limits on liability imposed by the system provider, the market, the clearing house and/or member firms. Such limits may vary; you should ask the firm with which you deal for details in this respect.
24. Trading on an electronic trading system may differ not only from trading in an openoutcry market but also from trading on other electronic trading systems. If you undertake transactions on an electronic trading system, you will be exposed to risk associated with the system including the failure of hardware and software. The result of any system failure may be that your order is either not executed according to your instructions or is not executed at all.
25. In some jurisdictions, and only then in restricted circumstances, firms are permitted to effect off-exchange transactions. The firm with which you deal may be acting as your counterparty to the transaction. It may be difficult or impossible to liquidate an existing position, to assess the value, to determine a fair price or to assess the exposure to risk. For these reasons, these transactions may involve increased risks. Off-exchange transactions may be less regulated or subject to a separate regulatory regime. Before you undertake such transactions, you should familiarize yourself with applicable rules and attendant risks.
ALL OF THE POINTS NOTED ABOVE APPLY TO ALL FUTURES TRADING WHETHER FOREIGN OR DOMESTIC. IN ADDITION, IF YOU ARE CONTEMPLATING TRADING FOREIGN FUTURES OR OPTIONS CONTRACTS, YOU SHOULD BE AWARE OF THE FOLLOWING ADDITIONAL RISKS:
26. Foreign futures transactions involve executing and clearing trades on a foreign exchange. This is the case even if the foreign exchange is formally “linked” to a domestic exchange, whereby a trade executed on one exchange liquidates or establishes a position on the other exchange. No domestic organization regulates the activities of a foreign exchange, including the execution, delivery, and clearing of transactions on such an exchange, and no domestic regulator has the power to compel enforcement of the rules of the foreign exchange or the laws of the foreign country. Moreover, such laws or regulations will vary depending on the foreign country in which the transaction occurs. For these reasons, customers who trade on foreign exchanges may not be afforded certain of the protections which apply to domestic transactions, including the right to use domestic alternative dispute resolution procedures. In particular, funds received from customers to margin foreign futures transactions may not be provided the same protections as funds received to margin futures transactions on domestic exchanges. Before you trade, you should familiarize yourself with the foreign rules which will apply to your particular transaction.
27. Finally, you should be aware that the price of any foreign futures or option contract and, therefore, the potential profit and loss resulting therefrom, may be affected by any fluctuation in the foreign exchange rate between the time the order is placed and the foreign futures contract is liquidated or the foreign option contract is liquidated or exercised.
THIS BRIEF STATEMENT CANNOT, OF COURSE, DISCLOSE ALL THE RISKS AND OTHER ASPECTS OF THE COMMODITY MARKETS.
CHS Hedging has established a Risk Management Program that is designed to monitor and manage the risks associated with the Company’s role as an FCM. The Company has a Risk Management Unit as established in accordance with CFTC Rule 1.11., that is responsible for identification of risks, establishment of risk tolerance limits, periodic risk exposure reports, and supervision, review and testing of the relevant policies and procedures. CHS Hedging also has a designated Risk Manager who is responsible for monitoring the risks of the Company. Relevant policies and procedures include the Risk Management Program, FCM Compliance Manual, Liquidity, Excess Customer Funds, Information Systems Security, Anti-money Laundering, Privacy, Electronic Communications and Red Flags policies.
In the normal course of business, CHS Hedging may be named as a defendant or respondent in civil actions and arbitrations and receives and responds to subpoenas and requests for information from regulatory authorities. Material administrative, civil, enforcement, or criminal complaints or actions filed against CHS Hedging can be accessed on NFA’s website at: www.nfa.futures.com (see CHS Hedging, LLC, Firm NFA ID #0192593). In addition, CHS Hedging notes the following:
On December 19, 2022, the CFTC issued an Order accepting an offer of settlement from CHS Hedging relating to anti-money laundering, risk management, books and records, and supervisory practices regarding a customer’s account. CHS Hedging agreed to pay a civil monetary penalty of $6.5 million. CHS Hedging also agreed to implement various remediation-related undertakings and cooperated with the CFTC throughout the course of the investigation.Enforcement complaints or actions filed against CHS Hedging can be accessed on the National Futures Association’s website at: https://www.nfa.futures.org/basicnet (see CHS Hedging, LLC, Firm NFA ID #0192593).
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