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Commodity Futures Trading Commission 

CEA CASES 

NAME: CONTINENTAL GRAIN COMPANY 

CITATION: 33 Agric. Dec. 1057 

DOCKET NUMBER: 214 

DATE: AUGUST 7, 1974 

DOCUMENT TYPE: DECISION AND ORDER 

(No. 15,959) 

In re CONTINENTAL GRAIN COMPANY. CEA Docket No. 214. Decided August 7, 1974. 

Futures trading -- exceeding limits -- Reports -- incomplete or incorrect

The stipulation of respondent has been accepted and the cease and desist 

order herein is issued, with the provisions as set forth therein. 

Darrold A. Dandy, for complainant. 

Arthur L. Liman, New York, N. Y., for respondent. 

Decision by William J. Weber, Administrative Law Judge.

DECISION AND ORDER

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 on 

June 27, 1973. The respondent is charged with violating sections 4g, 4i and 

6(b) of the Commodity Exchange Act (7 U.S.C. 6g, 6i, 9) and sections 1.35, 

15.01, 15.02, 18.00, 18.03, 19.00, 19.01, 19.10 of the regulations thereunder 

(17 CFR 1.35, 15.01, 15.02, 18.00, 18.03, 19.00, 19.01, 19.10). 

No hearing has been held in this proceeding. The respondent has filed a 

stipulation under section 0.4(b) of the rules of practice (17 CFR 0.4(b)) in 

which it (1) admits the facts hereinafter set forth in paragraphs 1 through 6 of 

the Findings of Fact, (2) admits for the purpose of this proceeding and for such 

purposes only the remaining facts set forth in the Findings of Fact, and (3) 

waives oral hearing on the charges in the complaint and consents to the entry, 

without further proceedings, of the order contained herein. 

Respondent also states in such stipulation that it admits no violation of any 

law, statute or regulation and any inaccuracies contained in the series 03 and 

04 reports referred to in the complaint were inadvertent; clerical in nature or 

primarily attributable to a failure of communication within the respondent 

wholly unrelated to the preparation and submission of such reports, that such 

inaccuracies were brought to the attention of the Commodity Exchange Authority 

by the respondent and were voluntarily corrected by the respondent with the 

filing of amended reports. Respondent further states that, notwithstanding such 

inaccuracies, at no time did the position of the respondent exceed prescribed 

futures trading limits and at no time did the respondent engage in any improper 

trading activity. 

FINDINGS OF FACT 

1. The respondent, a Delaware corporation, with its principal office and 

place of business at Two Broadway, New York, New York, is now, and was at all 

times material herein, a registered futures commission merchant under the 

Commodity Exchange Act. 
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2. The Chicago Board of Trade is now, and was at all times material herein, a 

duly designated contract market under the Commodity Exchange Act. 

3. During the period from July 24, 1972 through November 3, 1972, the 

respondent was a trader which held or controlled a reportable position in wheat, 

corn, oats, soybeans, soybean oil, and soybean meal futures. 

4. The respondent was required, pursuant to the applicable provisions of the 

Commodity Exchange Act, and the regulations promulgated thereunder, to file the 

appropriate series 03 reports with the Commodity Exchange Authority showing all 

transactions executed, and all open contract positions held, for its account in 

all such futures on all contract markets. 

5. During the period from June 2, 1972 through September 29, 1972, the 

respondent was engaged in merchandising, processing, or dealing in wheat, corn, 

oats, soybeans and the products and byproducts thereof and held or controlled a 

reportable position in wheat, corn, oats, and soybean futures. 

6. The respondent was required, pursuant to the applicable provisions of the 

Commodity Exchange Act and the regulations 

promulgated thereunder, to file the appropriate series 04 reports with the 

Commodity Exchange Authority showing, inter alia, the makeup of its fixed-price 

cash grain position including the stocks of such commodities and their products 

or byproducts owned, the quantity of fixed-price purchase commitments open in 

such commodities and their products and byproducts, and the quantity of fixedprice sales commitments open in such commodities and their products or 

byproducts. 

7. During the period described in paragraph 3 above, respondent submitted 

incomplete and inaccurate series 03 reports with respect to transactions in 

wheat executed on the Chicago Board of Trade for the account of the respondent 

as alleged in paragraph III of the complaint. 

8. During the period described in paragraph 5 above, respondent submitted 

incomplete and inaccurate series 04 reports with respect to its fixed-price cash 

position as alleged in paragraph IV of the complaint. 

CONCLUSIONS 

By reason of the facts as set forth in the Findings of Fact, it is concluded 

that the respondent violated sections 4g, 4i and 6(b) of the Commodity Exchange 

Act (7 U.S.C. 6g, 6i, 9) and sections 1.35, 15.01, 15.02, 18.00, 18.03, 19.00, 

19.01, 19.10 of the regulations thereunder (17 CFR 1.35, 15.01, 15.02, 18.00, 

18.03, 19.00, 19.01, 19.10). Inasmuch as the respondent has consented to the 

issuance of the order set forth below and complainant has recommended that such 

order be issued, the order will be issued. 

ORDER 

1. Respondent Continental Grain Company shall cease and desist from wilfully 

submitting any incomplete or inaccurate information in reports required under 

the Commodity Exchange Act. 

2. Respondent Continental Grain Company is prohibited from trading on or 

subject to the rules of any contract market for a period of fifteen (15) days 

such prohibition to apply to all trading done and positions held directly by 

Continental Grain Company, either for its own account or as the agent or 

representative of any other person or firm, and also to all trading done and 

positions held indirectly through persons or firms owned or controlled by 

the said respondent, or otherwise, but such prohibition shall not apply to or 

otherwise restrict in any way transactions or positions: 
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(a) which are bona fide hedging transactions or positions within the meaning 

of Section 4a(3) of the Commodity Exchange Act (7 U.S.C. 6a(3)) entered into or 

held on behalf of or for the account or benefit of the respondent or of persons 

directly or indirectly controlled by the respondent; or 

(b) which are transactions entered into or positions held by Conti-Commodity 

Services, Inc., a Delaware corporation (CCS), on behalf of or for the account or 

benefit of CCS or its customers exclusive of the respondent and of persons 

(other than CCS) directly or indirectly controlled by the respondent. 

For the purpose of determining under clause (a) of this paragraph 2 the 

hedging character of such transactions and positions, the futures and cash or 

spot transactions and positions of the respondent shall include such 

transactions and positions of any persons directly or indirectly controlled by 

the respondent. However, such prohibition [in paragraph 2 of this order 

regarding trading] shall not become effective unless the respondent should, 

after complaint and hearing in accordance with established procedure, be found 

to have violated [within one year from the date of issuance of this order] the 

Commodity Exchange Act or regulations thereunder by reason of acts other than 

those constituting the basis for the charges brought in this proceeding, in 

which event a supplemental order in this proceeding may be issued, without 

further notice, making effective forthwith the aforesaid prohibition which shall 

be in addition to any sanction which may be imposed as a result of such 

subsequent violation. 

3. References herein to the Commodity Exchange Act shall mean the Commodity 

Exchange Act as amended to the date hereof (7 U.S.C 1 et seq.). 

This order shall have the same force and effect as if entered after full 

hearing. A copy of this decision and order shall be served on each of the 

parties and on each contract market. 

This order shall become effective upon service upon the respondent. 

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