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The CEO of Cboe Global Markets has resigned after failing to disclose a personal relationship with a colleague.
The Chicago-based organization said in a statement on Tuesday that Edward Tilley’s failure to disclose the relationships “violates CBOE’s policies and is in stark contrast to the company’s values.”
Tilly is a veteran of Cboe and its predecessor, the Chicago Board Options Exchange, having worked on its trading floor since 1987. Among other things, Cboe operates the largest U.S. stock options trading venue.
He is the latest chief executive to leave unexpectedly due to personal ties. Last week, BP Chief Executive Bernard Looney resigned after failing to disclose the extent of past personal relationships within the company.
Cboe said Tilly resigned after the Cboe board and outside lawyers began an investigation last month. The company said the conduct in question was “not related to, or affecting the company’s strategy, financial performance, technology and market operations, reporting or internal controls.”
Cboe board member Fredric Tomczyk will take over as CEO. Tomczyk, who joined the board of directors in 2019, had served as CEO of brokerage TD Ameritrade for eight years as of 2016.
William Farrow, a newly appointed CBOE board member as non-executive chairman, said: “Fred’s familiarity with CBOE’s business, coupled with his decades of experience in the financial services industry, will Provides stability to the company and strengthens its commitment to growth.”
Cboe shares rose about 3% on the news and have gained 25% this year, outperforming rivals and the broader market as the exchange benefits from a surge in options trading, particularly on its flagship S&P 500 index product. .
However, the exchange group is best known for its Vix index, which measures stock market volatility implied by options and is often referred to as Wall Street’s “fear gauge.”
Earlier this year, Cboe, which operates the largest pan-European equity trading venue in Europe, also launched a push for new listings in Europe.
Tilley has led CBOE since 2013 and has held senior management positions since leaving the trading floor in 2006. He became chairman in 2017 after leading Cboe’s $3 billion acquisition of the Bats trading platform, which expanded the business into U.S. and European cash equities as well as exchange-traded funds and currencies.
“This is a big deal. He’s a very good leader of the company,” said John Lothian, publisher of an industry newsletter and a former futures broker in Chicago. “Ed represents the continuation of Cboe’s culture, even though it has changed since the acquisition of Bats, becoming more aggressive and no longer a member-led exchange.”
Under the contract, Tilly will retain stock options, including performance-related stock options, on a pro-rata basis until his departure date, CBOE said in a filing.
