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Commodity Futures Trading Commission 

CEA CASES 

NAME: A. E. ALBERT AND A. E. ALBERT AND SONS, INC. 

CITATION: 13 Agric. Dec. 1140 

DOCKET NUMBER: 64 

DATE: DECEMBER 28, 1955 

DOCUMENT TYPE: DECISION AND ORDER 

NOTE: SUPPLEMENTAL ORDER DATED DECEMBER 29, 1954 IS ATTACHED TO THE END OF THE 

DECISION AND ORDER. ANOTHER VERSION OF THE SUPPLEMENTAL ORDER THAT WAS NOT 

REPORTED IN THE AGRICULTURAL DECISIONS AVAILABLE IN THIS DATABASE. 

(No. 4119) 

In re A. E. ALBERT AND A. E. ALBERT AND SONS, INC. CEA Docket No. 64. Decided 

December 28, 1955. Supplemental Order December 29, 1954. 

Suspension of Trading Privileges -- Failure to Submit Reports -- Wilfulness -

- Consent Order

Where respondents failed to submit reports concerning transactions in potato 

futures and submitted incomplete and inaccurate reports with respect to similar 

transactions, in spite of previous warnings, and respondents admitted the 

allegations and consented to the entry of an order, held, effective January 3, 

1955, all contract markets shall refuse all trading privileges to the 

respondents for a period of 15 days, with the exception of bona fide orders with 

which respondents have no interest other than the usual broker-customer 

relationship. 

Mr. Benjamin M. Holstein for Commodity Exchange Authority. Mr. A. E. Albert and 

A. E. Albert and Sons, Inc., of Worthington, Massachusetts, respondents, pro se. 

Decision by Thomas J. Flavin, Judicial Officer 

PRELIMINARY STATEMENT

This is a quasi-judicial proceeding under the Commodity Exchange Act (7 

U.S.C., Chapter 1), instituted by a complaint and notice of hearing issued under 

section 6(b) of the act (7 U.S.C. 9) on November 12, 1954, by the Assistant 

Secretary of Agriculture. The complaint charged that the respondent corporation 

failed to submit reports concerning its transactions in potato futures on 30 

occasions within a period of approximately 13 months and that it submitted 

incomplete and inaccurate reports with respect to similar transactions on 46 

other occasions within that period, in violation of section 4i of the act (7 

U.S.C. 6i) and sections 6.10, 6.11, 6.12, and 6.21 of the rules and regulations 

thereunder (17 CFR 6.10, 6.11, 6.12, 6.21). The complaint alleged that these 

violations were wilful because the respondents had been previously informed in 

writing that their continued delinquency in connection with reporting 

requirements would result in formal action. 

No hearing was held. On December 21, 1954, prior to the date set for 

hearing, the respondents filed a document under section 0.4(b) of the rules of 

practice (17 CFR 0.4(b)), in which they admitted the facts alleged in the 

complaint, waived hearing on the charges, and consented to the entry of the 

order hereinafter set forth, with findings of fact. 

FINDINGS OF FACT
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1. Respondent A. E. Albert and Sons, Inc. is a corporation organized under 

the laws of the State of Massachusetts. The address of the said corporation is 

P. O. Box 107, Worthington, Massachusetts. On September 24, 1954, the said 

corporation was registered as a futures commission merchant under the Commodity 

Exchange Act and is presently so registered. Respondent A. E. Albert, an 

individual whose address is Chesterfield Avenue, Worthington, Massachusetts, is 

the president and principal shareholder of the respondent corporation, and 

manages and controls its business. At all times material to this complaint, the 

said A. E. Albert was a member of the New York Mercantile Exchange, and by 

reason thereof the respondent corporation exercised membership trading 

privileges on the said exchange. 

2. The New York Mercantile Exchange is a duly designated contract market 

under the Commodity Exchange Act. 

3. The acts and transactions hereinafter described were initiated and carried 

out under the supervision and direction of respondent A. E. Albert in his 

capacity as president and managing officer of the respondent corporation. 

4. On each day during the periods from September 10, 1953 to November 17, 

1953, from December 17, 1953 to March 23, 1954, from May 13, 1954 to May 16, 

1954, and from July 22, 1954 to October 18, 1954, the net long or net short open 

contract position of respondent A. E. Albert and Sons, Inc. in potato futures on 

the New York Mercantile Exchange ranged from 25 carlots to 174 carlots in a 

single future. By reason of the fact that such quantities were equal to or in 

excess of 25 carlots in one potato future, the said corporation was in reporting 

status and was required to report to the Commodity Exchange Authority with 

respect to all transactions executed and all open contract positions held for 

its account in all potato futures on all boards of trade (exchanges) during the 

said periods, as provided in section 4i of the Commodity Exchange Act and 

sections 6.10, 6.11, 6.12, and 6.21 of the rules and regulations thereunder (17 

CFR 6.10, 6.11, 6.12, 6.21). 

5. On approximately 30 business days within the periods specified in 

paragraph 4, and while the respondent corporation was in reporting status as 

therein described, transactions in potato futures on the New York Mercantile 

Exchange were executed for the account of the said corporation, but the 

respondents failed or refused to report to the Commodity Exchange Authority with 

respect to such transactions. On approximately 46 other business days within 

the periods specified in paragraph 4, and while the respondent corporation was 

in reporting status as therein described, transactions in potato futures on the 

New York Mercantile Exchange were executed for the account of the said 

corporation, but the respondents submitted incomplete and inaccurate reports 

with respect to such transactions. 

6. Between July 17, 1952 and January 12, 1954, the Commodity Exchange 

Authority communicated with the respondents nine times because of their failure 

to submit reports and because of the submission of incomplete and inaccurate 

reports. On January 12, 1954, the Administrator of the Commodity Exchange 

Authority addressed a letter to respondent A. E. Albert, calling attention to 

the delinquency of the respondents in submitting reports, informing them that 

such delinquency was a continuing violation of the Commodity Exchange Act, and 

warning them that continued failure in this regard might result in the 

institution of administrative proceedings directed toward denial of trading 

privileges on contract markets. 

CONCLUSIONS

Section 4i of the Commodity Exchange Act provides as follows: Sec. 4i. It 

shall be unlawful for any person to make any contract for the purchase or sale 

of any commodity for future delivery on or subject to the rules of any contract 

market unless such person shall report or cause to be reported to the properly 

designated officer in accordance with the rules and regulations of the Secretary 

of Agriculture (1) . . . and (2) whenever such person shall directly or 
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indirectly have or obtain a long or short position in any commodity or in any 

future of such commodity, equal to or in excess of such amount as shall be fixed 

from time to time by the Secretary of Agriculture . . . . 

Section 6.10 of the rules and regulations provides as follows: Sec. 6.10. 

Persons holding or controlling open contracts of specified size; reports on Form 

603. Every person who holds or controls open contracts in any one potato future 

on any one contract market which equal or exceed the amount fixed by the 

Secretary of Agriculture (in sec. 6.21 hereof) for reporting purposes under 

section 4i (2) of the Commodity Exchange Act shall report to the Commodity 

Exchange Authority on Form 603. Such report shall be made daily: . . . 

With respect to potato futures, the amount fixed by the Secretary of 

Agriculture for reporting purposes under these provisions is 25 carlots (17 CFR 

6.21). Other sections of the rules and regulations prescribed the time for 

filing reports and the information to be furnished (17 CFR 6.11, 6.12). 

The respondents have admitted the facts alleged in the complaint, which have 

been adopted as the findings of fact in this proceeding. It thus appears that 

they failed to file reports on 30 occasions when they were required to do so and 

that they submitted incomplete and inaccurate reports on 46 similar occasions. 

The failure to file complete, correct, and accurate reports when and as required 

is contrary to and constitutes a violation of the provisions of the act and the 

regulations. The number of instances involved and the fact that the respondents 

were given prior warning justify the conclusion that these violations were 

wilful. The complainant has recommended that the stipulation which the 

respondents have filed under section 0.4(b) of the rules of practice be accepted 

and that the order to which they have consented be issued. It is so concluded. 

ORDER

Effective January 3, 1955, all contract markets shall refuse all trading 

privileges to A. E. Albert, either for his own account or for the accounts of 

other persons, such refusal to apply to all trading done and positions held 

directly by the said A. E. Albert, and also to trading done and positions held 

indirectly through persons owned or controlled by the said A. E. Albert, or 

otherwise. 

Effective January 3, 1955, all contract markets shall refuse to A. E. Albert 

and Sons, Inc., all trading privileges for its own or house account for a period 

of fifteen (15) days, such refusal to apply to all trading done and positions 

held directly by the said A. E. Albert and Sons, Inc., and also to all trading 

done and positions held indirectly through persons owned or controlled by the 

said A. E. Albert and Sons, Inc., or otherwise, Provided, that such refusal 

shall not be construed to prohibit the execution of bona fide orders received by 

the said A. E. Albert and Sons, Inc., in its capacity as a registered futures 

commission merchant under the Commodity Exchange Act, in connection with which 

orders neither the said A. E. Albert and Sons, Inc. nor A. E. Albert has any 

interest other than the usual broker-customer relationship. 

A copy of this decision and order shall be served on the respondents and on 

each contract market. 

SUPPLEMENTAL ORDER

On December 28, 1954, an order was entered in this proceeding, effective 

January 3, 1955, directing all contract markets to deny all trading privileges 

on such markets to A. E. Albert and A. E. Albert and Sons, Inc. The denial of 

trading privileges to A. E. Albert did not state the period of denial. Such 

period is fifteen (15) days. 

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