Former Delta Air Lines Trader Penalized $3.1 Million by Nymex

  • Jon Ruggles and wife Ivonne barred from CME exchanges
  • Trader allegedly broke rules by profiting off Delta’s trades

Former Delta Air Lines Inc. employee Jon Ruggles was penalized $3.1 million and barred from ever trading again at exchanges run by CME Group Inc., which accused him of breaking rules by personally profiting off the airline’s orders.

Ruggles, who used to be Delta’s vice president of fuel management, leveraged advance knowledge of the airline’s trades to make money for himself in 2012, a violation of rules at the exchange and his employer, according to a statement from CME. The exchange fined him $300,000 and demanded he turn over $2.8 million in trading profits. His wife, Ivonne Ruggles, was also banned from CME exchanges. Jon Ruggles used her account to place the problematic trades, CME said.

“Ruggles repeatedly abused his trading discretion given to him by his employer for personal gain by intentionally trading his employer’s account opposite two personal accounts owned by his wife, Ivonne Ruggles,” according to the disciplinary notice sent Monday by CME’s Nymex division.

Both Jon and Ivonne Ruggles declined to be interviewed by CME’s investigators. A voicemail left for Jon Ruggles wasn’t returned.

Trebor Banstetter, a spokesman for Delta, confirmed that the Jon Ruggles fined by CME is the same person who worked for the airline in 2011 and 2012. CME alleged 82 instances of misconduct that occurred in 2012.

‘Highest Standards’

“Delta has the highest standards of ethics and expects all of its employees to maintain those standards,” the company said in an e-mailed statement. “Our values-based culture is essential to Delta’s success.”

Ruggles was in charge of Delta’s hedging strategy operation and expanded it, according to an excerpt of journalist Kate Kelly’s book “The Secret Club That Runs the World: Inside the Fraternity of Commodity Traders” published by Fortune magazine in 2014. Delta received a subpoena from the U.S. Commodity Futures Trading Commission in late 2012 asking for trading records for Ruggles, according to the excerpt.

Ruggles traded for his own personal use for years under an account registered in his wife’s name, and “since Ruggles was trading some of the same products at home that he traded at work, the potential for using his corporate knowledge to inform personal positions was omnipresent,” according to the article. Ruggles said the inquiry didn’t have anything to do with his job ending with Delta, Kelly’s report said.

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