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Commodity Futures Trading Commission 

CEA CASES 

NAME: JOHN HENRY PHELAN, III 

CITATION: 23 Agric. Dec. 616 

DOCKET NUMBER: 119 

DATE: JUNE 30, 1964 

DOCUMENT TYPE: DECISION AND ORDER 

(No. 9120) 

In re JOHN HENRY PHELAN, III. CEA Docket No. 119. Decided June 30, 1964. 

Trading Limits -- Reports -- Denial of Trading Privileges -- Consent

All contract markets are ordered to refuse trading privileges to respondent 

for a period of 30 days, for failure to file required reports with respect to 

his trading and positions in potato and grain futures in violation of section 4i 

of the Commodity Exchange Act. 

Mr. Earl L. Saunders for Commodity Exchange Authority. Respondent pro se. 

Decision by Thomas J. Flavin, Judicial Officer 

PRELIMINARY STATEMENT

This is a proceeding under the Commodity Exchange Act (7 U.S.C. Chapter 1), 

in which the respondent, a trader in commodity futures, is charged with failure 

to submit required reports concerning transactions in wheat futures, soybean 

futures and potato futures, in violation of section 4i of the act (7 U.S.C. § 

6i) and the applicable regulations thereunder. 

No hearing has been held with respect to this proceeding. On June 17, 1964, 

the respondent submitted a stipulation under section 0.4(b) of the rules of 

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

under "Findings of Fact," waives hearing on the charges in the complaint, and 

consents to the entry of the order contained herein. 

FINDINGS OF FACT

1. Respondent, John Henry Phelan, III, is an individual whose mailing address 

is P.O. Box 2270, Beaumont, Texas. 

2. The Board of Trade of the City of Chicago, hereinafter referred to as the 

Chicago Board of Trade, and the New York Mercantile Exchange are now and were at 

all times material herein duly designated contract markets under the Commodity 

Exchange Act. 

3. On each business day during the periods November 29, 1963, through January 

27, 1964, and February 27 through March 4, 1964, the respondent held or 

controlled a net long or a net short position in wheat futures on the Chicago 

Board of Trade, which position ranged from 200,000 bushels to 250,000 bushels in 

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

excess of 200,000 bushels, the respondent 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 or controlled by him, 

in all wheat futures on all boards of trade on said dates and with respect to 

all transactions by reason of which the respondent's position was reduced below 

reporting levels, as provided in section 4i of the Commodity Exchange Act (7 
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U.S.C. § 6i) and sections 15.01, 15.02, 15.03, 18.00, 18.01 and 18.03 of the 

regulations thereunder (17 CFR §§ 15.01, 15.02, 15.03, 18.00, 18.01, 18.03). 

4. On December 3, 4 and 12, 1963, January 7, 8 and 9, 1964, and February 27, 

1964, while the respondent was in reporting 

status as described in paragraph 3 above, and on January 28 and March 5, 1964, 

when the respondent's position was reduced below 200,000 bushels, transactions 

in wheat futures on the Chicago Board of Trade were executed on his behalf, but 

the respondent failed and refused to submit reports to the Commodity Exchange 

Authority. 

5. On each business day during the periods December 6 through December 10, 

1963, and January 3 through March 5, 1964, the respondent held or controlled a 

net long or a net short position in soybean futures on the Chicago Board of 

Trade, which position ranged from 200,000 bushels to 725,000 bushels in a single 

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

of 200,000 bushels, the respondent 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 or controlled by him, in all 

soybean futures on all boards of trade on said dates and with respect to all 

transactions by reason of which the respondent's position was reduced below 

reporting levels, as provided in section 4i of the Commodity Exchange Act (7 

U.S.C. § 6i) and sections 15.01, 15.02, 15.03, 18.00, 18.01 and 18.03 of the 

regulations thereunder (17 CFR §§ 15.01, 15.02, 15.03, 18.00, 18.01, 18.03). 

6. On December 6, 1963, January 3, 7, 9, 10, 13, 14, 15, 28 and 31, 1964, 

February 3, 5, 6, 11, 13, 25, 27 and 28, 1964, and on March 5, 1964, while the 

respondent was in reporting status as described in paragraph 5 above, and on 

December 11, 1963, and March 6, 1964, when the respondent's position was reduced 

below 200,000 bushels, transactions in soybean futures on the Chicago Board of 

Trade were executed on his behalf, but the respondent failed and refused to 

submit reports to the Commodity Exchange Authority. 

7. On each business day during the period April 2 through April 22, 1964, the 

respondent held or controlled a net short position in potato futures on the New 

York Mercantile Exchange, which position ranged from 32 carlots to 102 carlots 

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

in excess of 25 carlots, the respondent 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 or controlled by him, in all 

potato futures 

on all boards of trade on said dates and with respect to all transactions by 

reason of which the respondent's position was reduced below reporting levels, as 

provided in section 4i of the Commodity Exchange Act (7 U.S.C. § 6i) and 

sections 15.01, 15.02, 15.03, 18.00, 18.01, and 18.03 of the regulations 

thereunder (17 CFR §§ 15.01, 15.02, 15.03, 18.00, 18.01, 18.03). 

8. On April 2, 3, 14, 15 and 22, 1964, while the respondent was in reporting 

status as described in paragraph 7 above, transactions in pototo futures on the 

New York Mercantile Exchange were executed on his behalf, but the respondent 

failed or refused to submit reports to the Commodity Exchange Authority. 

CONCLUSIONS

Section 4i of the Commodity Exchange Act (7 U.S.C. § 6i) requires every 

person who trades in futures to submit reports with respect to such trading 

"whenever such person shall directly or 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." The quantity fixed by the Secretary for reporting purposes under 
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the above provision is 25 carlots in any one potato future, and 200,000 bushels 

in any one grain future (17 CFR § 15.03). The facts set forth in Findings of 

Fact 3 through 8 demonstrate that on numerous occasions the respondent failed or 

refused to file required reports with respect to his trading and positions in 

potato and grain futures, in violation of section 4i of the act, and sections 

15.01, 15.02, 15.03, 18.00, 18.01, and 18.03 of the regulations issued by the 

Secretary (17 CFR §§ 15.01, 15.02, 15.03, 18.00, 18.01 and 18.03). 

The complainant states that the administrative officials of the Commodity 

Exchange Authority have carefully considered the proposed stipulation and order, 

and that they believe that the proposed sanction is adequate and that the prompt 

entry, without further proceedings, of the order to which the respondent has 

consented will constitute a satisfactory disposition of this case as against the 

respondent, serve the public interest, and effectuate the purposes of the Act. 

The complainant recommends, therefore, that the stipulation and waiver submitted 

by the respondent be accepted and that the proposed order be issued. It is so 

concluded. 

ORDER

Effective July 30, 1964, all contract markets shall refuse all trading 

privileges to the respondent, John Henry Phelan, III, for a period of 30 days, 

such refusal to apply to all trading done and positions held by him 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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