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Commodity Futures Trading Commission 

CEA CASES 

NAME: NEVIN F. HENCH 

DOCKET NUMBER: 230 

DATE: JANUARY 9, 1975 

DOCUMENT TYPE: DECISION AND ORDER 

UNITED STATES DEPARTMENT OF AGRICULTURE 

BEFORE THE SECRETARY OF AGRICULTURE 

In re: Nevin F. Hench, Respondent 

CEA Docket No. 230 

Decision 

Preliminary Statement 

This is a disciplinary proceeding under sections 6(b) and 6(c) of the 

Commodity Exchange Act, "the Act" (7 U.S.C. §§9 and 13(b)), instituted by a 

complaint and notice of hearing filed by the Assistant Secretary of Agriculture 

on June 24, 1974. 

The complaint alleges in substance that the respondent, Nevin F. Hench, 

solicited and accepted orders for the purchase or sale of commodities for future 

delivery on or subject to the rules of one or more contract markets and accepted 

monies to margin, guarantee or secure such resulting trades without having 

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

Further, the Complaint alleges that respondent, during the period involved, 

converted to his own use and failed to hold in separate accounts the monies 

received by him to margin, guarantee or secure the contracts of his customers, 

and during this period the respondent knowingly made false and deceptive 

statements to his customers. On August 3, 1974, complainant's attorney 

 

filed a motion to assign a date for oral hearing. On August 23, 1974, John G. 

Liebert, the Administrative Law Judge assigned to the matter herein, issued an 

order allowing the respondent until 20 days after service of that order, in 

which to file an amended answer, if he intended so to do. On October 24, 1974, 

Judge Liebert filed an order for the preparation of a proposed decision because 

an amended answer was not forthcoming by respondent. 

This proposed decision is in accordance with the provisions of section 0.9(c) 

of the Rules of Practice under the Commodity Exchange Act (17 CFR 0.9(c)) and 

the order of Administrative Law Judge John G. Liebert dated October 24, 1974. 

Findings of Fact 

1. The respondent, Nevin F. Hench, an individual, resides at 4201-66th Avenue 

North, Brooklyn Center, Minnesota. 

2. From on or about June 1972 through on or about July 1973 respondent 

solicited and accepted orders for the purchase or sale of commodities for future 

delivery on or subject to the rules of one or more contract markets. In 

connection with such solicitation and acceptance of orders, respondent accepted 

money to margin, guarantee or secure trades, without having registered as a 

futures commission merchant under the Commodity Exchange Act, as follows: 

Customer Amount of Funds Accepted

Michael James Bakke $ 1,600.00

Harold M. Christenson 1,000.00
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Customer Amount of Funds Accepted

Rand D. Leeman 1,000.00 

Customer Amount of Funds Accepted

Ronald G. Oswald 6,000.00

Frank J. Jeffers 8,000.00

Inari Paaskynen 1,000.00

Dorothy E. Meany 1,000.00

Bernice Grotenhuis 2,000.00

Gerald S. Jones 1,400.00

Bruce B. Reimer 600.00

Dennis M. Morin 800.00

Michael E. Migatz 2,500.00

Martin C. Christiansen 3,000.00

Calixte L. Robideaux 2,000.00

Harold M. Juutilainen 8,000.00

Total $ 39,900.00

3. During the period from on or about June 1972 through on or about July 

1973, while engaged as a futures commission merchant, respondent converted to 

his own use, and failed to hold in separate accounts, the money received by him 

to margin, guarantee or secure the trades or contracts of his customers as 

detailed in Finding of Fact 2 above. 

4. During this period, respondent knowingly made false and deceptive 

statements to the customers listed in Finding of Fact 2 above concerning (a) 

activity in customers' accounts, although no accounts were opened in such 

customers' names, and (b) profits realized from activity in such customers' 

accounts. 

5. The transactions in commodities for future delivery referred to herein, if 

executed, could have been used for (a) hedgeing transactions in interstate 

commerce in such commodities or the products or byproducts thereof, or (b) 

determining the price basis of transactions in interstate commerce in such 

commodities, or (c) delivering any such commodity sold, shipped, or received in 

interstate commerce for the fulfillment of such contracts. 

 

Conclusions 

The facts admitted by the respondent by his failure to answer the complaint 

clearly shows that the respondent willfully violated section 4b, 4d and 9 of the 

Commodity Exchange Act (7 U.S.C. §§ 6b, 6d, and 13), and section 1.20 of the 

regulations issued thereunder (17 CFR 1.20). Accordingly, it is concluded that 

the following order is proper and should be issued in the circumstances. 

Order 

1. Effective on the twentieth day after the date this order becomes final, 

respondent Nevin F. Hench is prohibited from trading in any commodity or on any 

contract market for twenty (20) years, and all contract markets shall deny 

trading privileges to the said respondent for that period. Such prohibition and 

denial shall apply to all trading done and all positions held directly by the 

said respondent, either for his 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. 

2. Effective upon the date this order becomes final, respondent Nevin F. 

Hench shall cease and desist from: 

(a) Soliciting or accepting orders for the purchase or sale of commodities 

for future delivery on or subject to the rules of one or more contract markets 

and accepting monies to margin, guarantee 
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or secure such orders without having registered as a futures commission merchant 

under the Commodity Exchange Act; 

(b) Converting to his own use and failing to hold in separate accounts monies 

received by him to margin, guarantee or secure customer's contracts; and 

(c) Knowingly making false and deceptive statements to his customers. 

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

on each contract market. 

Pursuant to the amended rules of practice governing proceedings under the 

Commodity Exchange Act, this Decision and Order becomes final without further 

proceeding 35 days after service hereof, unless appealed to the Secretary by a 

party to the proceeding within 30 days after service, as provided in section 

0.16 and section 0.18 of the amended rules of practice published in the Federal 

Register of August 20, 1973 (38 F.R. 22381). 

Done at Washington, D. C. 

JAN 9 1975 

John G. Liebert 

Administrative Law Judge 

Referee 

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