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Commodity Futures Trading Commission 

CEA CASES 

NAME: ARTHUR N. ECONOMOU, AND ARTHUR N. ECONOMOU & CO., INC. 

DOCKET NUMBER: 167 

DATE: FEBRUARY 18, 1970 

DOCUMENT TYPE: COMPLAINT 

UNITED STATES DEPARTMENT OF AGRICULTURE 

BEFORE THE SECRETARY OF AGRICULTURE 

In re: Arthur N. Economou, and Arthur N. Economou & Co., Inc., Respondents 

CEA Docket No. 167 

Complaint and Notice of Hearing Under The Commodity Exchange Act 

There is reason to believe that the respondents have violated the Commodity 

Exchange Act (7 U.S.C. 1964 ed., Chapter 1, as amended, Supp. IV, 1969) and the 

regulations made pursuant thereto. Therefore, this complaint and notice of 

hearing is issued stating the charges in that respect as follows: 

I 

Respondent Arthur N. Economou is an individual whose business address is 256 

Fifth Avenue, New York, New York 10001. 

II 

Respondent Arthur N. Economou and Co., Inc., a Delaware corporation with its 

office and place of business at 256 Fifth Avenue, New York, New York 10001, is 

registered as a futures commission merchant under the Commodity Exchange Act and 

was so registered at all times during 1969. At all such times, respondent 

Arthur N. Economou was in complete control of the respondent corporation and 

initiated and 

carried out out the acts, dealings and transactions of the corporation. At all 

such times, the corporate respondent, acting in the capacity of futures 

commission merchant under the Commodity Exchange Act, engaged in trading in 

commodities for future delivery for the accounts of customers and holding for 

such customers sums of money, representing deposits of margin by and trading 

profits accruing to such customers. 

III 

During the period from on or about March 31, 1969 through on or about June 

30, 1969, the respondent corporation while engaged in business as futures 

commission merchant under the Commodity Exchange Act, failed to meet the minimum 

financial requirements prescribed by section 1.17 of the regulations (34 F.R. 

599) issued by the Secretary of Agriculture under the Commodity Exchange Act. 

Respondents submitted financial reports on Form 1-FR to Commodity Exchange 

Authority as of March 31 and June 30, 1969, respectively, which included among 

the "current assets" the following: 

Report as of March 31, 1969 

(a) "Due from Arthur N. Economou . . . $ 2,000.00 (Secured by pledge of GTO 

Pontiac automobile valued at $ 2,500)" 
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(b) "Due from The American Association of Commodity Traders . . . $ 9,626.81 

(Secured by inventory of Association publications value appraised conservatively 

at $ 15,000)" 

(c) "OTHER CURRENT ASSETS . . . 'acquisition cost', in the Economou Precious 

Metals Futures Trading Syndicate . . . $ 6,016.80" 

Report as of June 30, 1969 

(a) "Due from American Board of Trade $ 846.00" 

(b) "Due from Arthur N. Economou (Secured by pledge of GTO Pontiac automobile 

valued at $ 2,500) $ 2,000.00" 

(c) "Due from The American Association of Commodity Traders (Secured by 

inventory of Association publications, value appraised conservatively at $ 

15,000.00) $ 7,080.81" 

(d) "Contract acquisitions: 

Economou Precious Metals Futures Trading Syndicate $ 9,304.97 

Economou Grains Futures Trading Syndicate $ 23.00" 

In truth and in fact, none of the items specified above qualified as current 

assets within the meaning of that term as used in section 1.17 of the 

regulations (34 F.R. 599) issued under the Commodity Exchange Act. When such 

items are deducted from the respondents' "current assets", they lacked 

approximately $ 6,000.00 as of March 31, 1969, and $ 700.00 as of June 30, 1969, 

of having enough funds to meet the minimum financial requirements prescribed by 

the above-cited section of the regulations. 

IV 

By reason of the facts alleged in this complaint, the respondents willfully 

violated section 4f of the Commodity Exchange Act (7 U.S.C. 6f, Supp. IV, 1969) 

and section 1.17 of the regulations issued thereunder (34 F.R. 599). 

WHEREFORE, it is hereby ordered that this complaint and notice of hearing be 

served upon the respondents and this proceeding shall be governed by sections 

0.1, 0.2, 0.4(b), 0.5 through 0.22, and 0.28 

of the rules of practice under the Commodity Exchange Act (17 CFR 0.1, 0.2, 

0.4(b), 0.5 through 0.22, 0.28). The respondents will have twenty (20) days 

after the receipt of this complaint in which to file with the Hearing Clerk, 

United States Department of Agriculture, Washington, D. C. 20250, an answer with 

an original and four copies, fully and completely stating the nature of the 

defense and admitting or denying, specifically and in detail, each allegation of 

this complaint. Allegations not answered will be deemed admitted for the 

purposes of this proceeding. Failure to file an answer will constitute an 

admission of all the allegations of this complaint and a waiver of hearing. The 

filing of an answer in which all of the material allegations of fact contained 

in the complaint are admitted likewise shall constitute a waiver of hearing 

unless a hearing is requested. The respondents are hereby notified that unless 

hearing is waived, a hearing will be held at 10:00 a.m., local time, on March 

31, 1970, in New York, New York, at a place therein to be specified later, 

before a referee designated to conduct such hearing. At such hearing, the 

respondents will have the right to appear and show cause, if any there be, why 

an appropriate order should not be issued in accordance with the Commodity 

Exchange Act, (1) prohibiting the respondents from trading on or subject to the 

rules of any contract market, and directing that all contract markets refuse all 

trading privileges to the respondents for such period of time as may be 

determined, (2) directing that the respondents shall cease and desist from 
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violating the Commodity Exchange Act and regulations in the manner alleged 

herein, and (3) suspending or revoking the registration of respondent Arthur N. 

Economou & Co., Inc., as futures commission merchant. 

It is ordered that this complaint and notice of hearing be served on the 

respondents at least twenty (20) days prior to the date set, for hearing. 

Done at Washington, D. C. 

FEBRUARY 18, 1970 

[SEE SIGNATURE IN ORIGINAL] 

Richard E. Lyng 

Assistant Secretary 

 

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