Jenny Zhou Fined by NYSE and NYSE Arca

Jenny Zhou (CRD #: 6427569), a broker registered with GTS Securities, has been fined by both the NYSE and NYSE Arca, according to her BrokerCheck record, accessed on May 17, 2023. Read on to learn more about her alleged conduct as a broker.

Fine by NYSE Arca

On April 24, 2023, Jenny Zhou consented to the entry of findings that she, another individual, and GTS Securities allegedly violated NYSE Arca Rules 11.18 and 11.1(b) with regard to algorithmic trading strategy TMS-45E.

TMS-45E allegedly violated NYSE Arca rules in relation to two types of trading activity:

1. Amending the size of its Market-on-Close (MOC) orders to offset a smaller percentage of the firm’s estimated imbalance shortly before the freeze period for the Closing Auction, often resulting in the strategy reducing or canceling some of its MOC orders.
2. Executing certain peg orders and add liquidity only orders (ALO orders) in the Closing Auction on the opposite side of the market as its MOC Orders.

NYSE Arca Rules 11.18 and 11.1(b)

NYSE Arca Rule 11.18 requires firms to establish systems of supervision over their brokers to ensure their compliance with federal securities regulations and NYSE Arca Rules.

NYSE Arca Rule 11.1(b) requires firms and brokers to adhere to the principles of good business practice with regard to their business affairs.

Sanctions

Jenny Zhou consented to censure and a fine of $75,000.

Fine by NYSE

On April 24, 2023, Jenny Zhou consented to the entry of findings that she, another individual, and GTS Securities allegedly violated NYSE Rules 3110 and 2010 with regard to algorithmic trading strategy TMS-45X.

TMS-45X allegedly violated NYSE rules through three types of trading activity:

1. Targeting an intraday accumulation less than the full size of its outstanding discretionary orders (D orders), frequently 85%, resulting in the strategy reducing or canceling in part its D Orders shortly before the Closing Auction.
2. Executing certain ALO orders in the Closing Auction on the opposite side of the market as its D Orders.
3. Sending residual “risk positions” through GTS Securities’ Central Risk Book to the firm’s Designated Market Maker (DMM), resulting in the GTS DMM trading in the Closing Auction opposite the TMS-45X’s D Orders.

NYSE Rules 3110 and 2010

NYSE Rule 3110 requires all member organizations to establish systems of supervision over their brokers to ensure their compliance with federal securities laws and NYSE rules.

NYSE Rule 2010 requires members and member organizations to observe high standards of commercial honor and just and equitable principles of trade.

Sanctions

Jenny Zhou consented to censure and a fine of $75,000.

Investigations by NYSE

On December 9, 2021, NYSE Regulation Enforcement launched an investigation into Jenny Zhou’s alleged violations of the following regulations with regard to a trading strategy:

• Sections 9(a)(1) and (2), Section 10(b) Rule 10b-5 thereunder, and Section 20(a) of the Securities Exchange Act of 1934
• NYSE Arca Rules 9.1-E(c) and (d), 11.1, 11.2, 11.5, and 11.18

On June 18, 2021, NYSE Regulation Enforcement began an investigation into allegations that Jenny Zhou violated the following regulations in relation to a trading strategy:

• Sections 9(a)(1) and (2), Section 10(b) and Rule 10b-5 thereunder, and Section 20(a) of the Securities Exchange Act of 1934
• NYSE Rules 2010, 2020, 3110, 6140(b) and (e), and 8210

Background Information

Jenny Zhou has passed the following exams:

• Series 57TO – Securities Trader Exam
• SIE – Securities Industry Essentials Examination
• Series 7 – General Securities Representative Examination
• Series 24 – General Securities Principal Examination

She is not currently a registered broker in any state.

Kurta Law Can Help

If you worked with Jenny Zhou and you have concerns about your investments, please contact us today at 877-600-0098 or info@kurtalawfirm.com for a free consultation.

For over 20 years, Kurta Law has advocated on behalf of investors who want to recover their investment losses from brokers and brokerage firms. Kurta Law is a nationally recognized law firm and exclusively represents investors against brokers and brokerage firms on a contingency basis. This means that the firm only earns a fee if our securities attorneys recover money on your behalf.