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Commodity Futures Trading Commission 

CEA CASES 

NAME: WEBSTER E. COLLINS 

CITATION: 24 Agric. Dec. 3 

DOCKET NUMBER: 121 

DATE: JANUARY 14, 1965 

DOCUMENT TYPE: DECISION AND ORDER 

(No. 9564) 

In re WEBSTER E. COLLINS. CEA Docket No. 121. Decided January 14, 1965. 

Denial of trading privileges -- Consent

Order entered denying for a period of 30 days all trading privileges to 

respondent on all contract markets on basis of admitted facts conferring 

jurisdiction upon the Secretary and by stipulation of the parties in proceeding 

dealing with May 1963 wool futures on the Wool Associates of the New York Cotton 

Exchange, Inc. 

Mr. Earl L. Saunders for Commodity Exchange Authority. Mr. Philip J. Ryan, of 

Springfield, Mass., for respondent. 

Decision by Thomas J. Flavin, Judicial Officer

PRELIMINARY STATEMENT

This is an administrative proceeding under the Commodity Exchange Act (7 

U.S.C. § 1 et seq.), instituted by a complaint and notice of hearing issued 

under § 6 (b) of the Act (7 U.S.C. § 9) on October 7, 1964, by the Assistant 

Secretary of Agriculture. The complaint charges that the respondent attempted 

to manipulate and did in fact manipulate the prices of wool futures on the Wool 

Associates of the New York Cotton Exchange, Inc., in violation of §§ 6(b) and 9 

of the Act (7 U.S.C. §§ 9 and 13). 

No hearing has been held with respect to this proceeding. On January 14, 

1965, the respondent filed a stipulation under § 0.4(b) of the rules of practice 

(17 CFR § 0.4(b)) in which he admits the facts hereinafter set forth, waives 

hearing on the charges, and consents to the entry of the order contained herein. 

FINDINGS OF FACT

1. The respondent, Webster E. Collins, an individual whose business address 

is 170 Lyman Street, Springfield, Massachusetts, is now, and was at all times 

material herein, a member of the Wool Associates of the New York Cotton 

Exchange, Inc. 

2. The Wool Associates of the New York Cotton Exchange, Inc., hereinafter 

sometimes referred to as the exchange, is now, and was at all times material 

herein, a board of trade duly designated as a contract market under the 

Commodity Exchange Act. 

3. The futures transactions referred to herein relate to the May 1963 wool 

future on the Wool Associates of the New York Cotton Exchange, Inc. A wool 

futures contract on the exchange is a contract for the grease equivalent of 

6,000 pounds (clean weight) of wool. The last day for trading in the May 1963 

wool future on the exchange was May 23, 1963, and that was also the last day on 

which notice could be given of intention to deliver wool in satisfaction of 

positions in such future. In order to give notice of intention to deliver wool 
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in satisfaction of such futures positions, the person making delivery was 

required to have the amount of wool referred to in the delivery notice, and such 

wool must have been inspected and certificated in accordance with the rules of 

the exchange and be located in a warehouse (in the Greater Boston, Massachusetts 

area) approved by the exchange for delivery. 

4. On April 23, 1963, the day prior to the first day for issuing notices of 

intention to deliver wool on short futures contracts in the May 1963 wool future 

on the exchange, the respondent owned or controlled a net long position of 210 

contracts in such future, which position constituted approximately 48.9 percent 

of the total long open interest on that day. 

5. On May 10, 1963, on which day the respondent owned or controlled a net 

long position of 207 contracts in the May 1963 wool future, the respondent 

contracted to sell to a wool merchant an amount of certificated wool equivalent 

to 161 futures contracts at a price of 128.0 cents per pound. On the same day, 

May 10, 

1963, the price of the May 1963 wool future ranged from 132.4 cents per pound to 

132.5 cents per pound, closing at 132.5 cents per pound. 

6. By the close of business on May 21, 1963, the day prior to the penultimate 

day for trading in the May 1963 wool future, the net long position owned or 

controlled by the respondent in the May 1963 wool future amounted to 196 

contracts, an amount representing approximately 79.4 percent of the total long 

open interest in such future. By the close of business on May 22, 1963, next to 

the last day of trading in the May 1963 wool future, the net long position owned 

or controlled by the respondent in the May 1963 wool future amounted to 186 

contracts, an amount representing approximately 95.4 percent of the total long 

open interest in such future. 

7. At the close of business on May 21, 1963, the total stocks of certificated 

wool were sufficient to liquidate 332 futures contracts by delivery and at the 

close of business on May 22, 1963, the total stocks of certificated wool were 

sufficient to liquidate 341 futures contracts by delivery. Of such certificated 

stocks the respondent held an amount of certificated wool equivalent to 196 

futures contracts at the close of business on May 21, 1963, and to 201 futures 

contracts at the close of business on May 22, 1963. One hundred sixty one lots 

of the certificated wool which the respondent held on May 21 and 22, 1963, were 

being held by him to be applied on the sales contract referred to in paragraph 5 

above. 

8. On May 21, 1963, the price of the May 1963 wool future ranged from 133.3 

cents per pound to 134.4 cents per pound, and closed at 134.0 cents per pound 

bid and 134.4 cents per pound asked. On May 22, 1963, the price of the May 1963 

wool future opened at 134.0 cents per pound bid and 134.8 cents per pound asked, 

and ranged from 134.4 cents per pound to 137.9 cents per pound, closing at 137.9 

cents per pound. On May 23, 1963, the last day for trading in the May 1963 wool 

future, the price of the future opened at 139.4 cents per pound and ranged from 

139.0 cents per pound to 140.4 cents per pound and closed at 140.4 cents per 

pound. 

9. On May 22, 1963, the respondent sold 10 contracts at a price of 137.5 

cents per pound. On May 23, 1963, the respondent sold 69 contracts, 25 

contracts at a price of 139.4 cents per pound and 44 contracts at a price of 

140.4 cents per pound. The respondent's sales were made pursuant to orders 

which set forth the price limits below which such futures could not be sold. 

CONCLUSIONS

Section 0.4(b) of the rules of practice under the Commodity Exchange Act (17 

CFR § 0.4(b)) provides as follows: 
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(b) Consent Order. At any time after the issuance of the complaint and prior 

to the hearing in any proceeding, the Secretary, in his discretion, may allow 

the respondent to consent to an order. In so consenting, the respondent must 

submit, for filing in the record, a stipulation or statement in which he admits 

at least those facts necessary to the Secretary's jurisdiction and agrees that 

an order may be entered against him. Upon a record composed of the complaint 

and the stipulation or agreement consenting to the order, the Secretary may 

enter the order consented to by the respondent, which shall have the same force 

and effect as an order made after oral hearings. 

The facts admitted by the respondent and set forth in the findings of fact 

are sufficient to subject him to the jurisdiction of the Secretary of 

Agriculture under the provisions of the above section. 

The complainant has filed a recommendation which recites that it has 

carefully considered the stipulation and the terms of the proposed order. It is 

the view of the complainant that the proposed sanction would be adequate, and 

that the prompt entry of such an order without further proceedings would 

constitute a satisfactory disposition of this case, serve the public interest, 

and effectuate the purposes of the Commodity Exchange Act. The complainant 

therefore recommends that the stipulation and waiver be accepted and that the 

proposed order be issued, terminating this proceeding. It is so concluded. 

ORDER

Effective on the thirtieth day after the date of entry of this order, all 

contract markets shall refuse all trading privileges to the respondent, Webster 

E. Collins, for a period of thirty days, such refusal to apply to all trading 

done and positions held by the said Webster E. Collins directly or indirectly. 

A copy of this decision and order shall be served upon the respondent and 

upon each contract market. 

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