North American Derivatives Exchange, Inc. (Nadex) has published a notice of disciplinary action as to Nathan Peachey.
The Compliance Department was notified that Peachey was indicted in Federal District Court in November 2019 alleging, among other charges, fraud and money laundering. Upon further investigation, Nadex discovered that Peachey was convicted of the relevant charges in the indictment in December 2021.
Peachey failed to timely apprise Nadex that he was a party to the aforementioned criminal matter, when he was originally indicted on November 5, 2019, approximately six months after Peachey applied for Nadex Membership on March 8, 2019, and of his subsequent conviction.
In addition, Peachey failed to fully comply with this investigation when he did not directly respond to the Compliance Department’s request for information regarding the aforementioned matter and replied with unrelated information.
The Compliance Department also found Peachey allowed a third-party to fund his Nadex account by transferring funds into his bank account which were subsequently transferred to Nadex, thus providing a third-party with a direct economic interest in the trading activity in his Nadex account.
Further, Nadex’s investigation revealed that Peachey executed trades in his Nadex account with funds that would not have been available to the bank account on record, but for the funding from the third-party and traded his account on behalf of the third-party.
Based on Nadex’s investigation, the Compliance Department determined that Peachey violated Nadex Rule 3.3(d)(v) when he failed to timely disclose the aforementioned criminal matter or any time thereafter to Nadex while he was a Member. Further, Compliance concluded that Peachey violated Nadex Rule 5.19(g)(1) and Member Representations, Section (d) when he executed trades in his Nadex account on a third-party’s behalf and allowed a third-party to have an economic interest in his Nadex account.
Finally, the Compliance Department concluded that Peachey violated Rule 3.3(a) and Member Acknowledgements and Authorizations, Section (h) of the Nadex Membership Agreement when he failed to cooperate with the Compliance Department’s inquiry regarding these matters.
As a result of the aforementioned violations, the Nadex Compliance Department has deemed it appropriate that Nathan Peachey’s Nadex Membership be revoked, his account terminated, and he be permanently banned from trading on Nadex Markets, either directly for his own account or through an intermediary, or as an authorized trader on behalf of any other account.