Page 1 

Commodity Futures Trading Commission 

CEA CASES 

NAME: WILLIAM J. MALLERS 

DOCKET NUMBER: 86 

DATE: SEPTEMBER 2, 1958 

DOCUMENT TYPE: COMPLAINT 

UNITED STATES DEPARTMENT OF AGRICULTURE 

BEFORE THE SECRETARY OF AGRICULTURE 

In re: William J. Mallers, Respondent 

CEA Docket No. 86 

Complaint and Notice of Hearing Under Section 6(b) of the Commodity Exchange 

Act 

There is reason to believe that the respondent, William J. Mallers, has 

violated the provisions of the Commodity Exchange Act (7 U.S.C., 1952 ed., 

Chapter 1), and the rules and regulations issued thereunder (17 CFR, Part 1). 

In accordance with the provisions of section 6(b) of the Commodity Exchange Act 

(7 U.S.C., 1952 ed., § 9), this complaint and notice of hearing is issued 

stating the charges in that respect as follows: 

I 

Respondent William J. Mallers, an individual whose address is 124 Keeney 

Street, Evanston, Illinois, is now and was at all times material to this 

complaint a member of the Board of Trade of the City of Chicago and a registered 

floor broker under the Commodity Exchange Act. 

II 

The Board of Trade of the City of Chicago, hereinafter called the Chicago 

Board of Trade, is now and was at all times material to this complaint a duly 

designated contract market under the Commodity Exchange Act. 

III 

In the transactions listed below, the respondent, acting as floor broker on 

orders received from Bache and Company, a registered futures commission 

merchant, sold certain quantities of old July 1957 wheat futures on the Chicago 

Board of Trade to one Herald E. Gibbs, also a registered floor broker, and in 

each instance purchased identical quantities of the same future at the same 

price from the said Herald E. Gibbs. The said trades were consummated by means 

of negotiation between the respondent and the said Herald E. Gibbs. The 

respondent made each of the said sales for the account of his principal, the 

said Bache and Company, in accordance with the orders which he had received from 

Bache and Company, and made each of the said purchases for his personal account, 

the said Herald E. Gibbs taking the opposite side of each of such trades for the 

personal 

account of the said Herald E. Gibbs. The dates, commodities sold and purchased, 

and the prices were as follows: 

Date Bought Sold Opposite Opposite 

1957 (Bushels) (Bushels) Account Price Broker Account 

April 22 15,000 Bache $ 2.11 Gibbs Gibbs 

April 22 15,000 Mallers 2.11 Gibbs Gibbs 
Page 2 

Date Bought Sold Opposite Opposite 

1957 (Bushels) (Bushels) Account Price Broker Account 

April 24 5,000 Bache 2.10 1/2 Gibbs Gibbs 

April 24 5,000 Mallers 2.10 1/2 Gibbs Gibbs 

April 24 30,000 Bache 2.10 Gibbs Gibbs 

April 24 30,000 Mallers 2.10 Gibbs Gibbs 

April 26 10,000 Bache 2.10 3/4 Gibbs Gibbs 

April 26 10,000 Mallers 2.10 3/4 Gibbs Gibbs 

The above trades were capable of being used for hedging transactions in 

interstate commerce in wheat or the products or by-products thereof, or for 

determining the price basis of transactions in interstate commerce in wheat, or 

for delivering wheat sold, shipped, or received in interstate commerce. 

By reason of such transactions the respondent wilfully and knowingly, and 

without the prior consent of his principal, the said Bache and Company, became 

the buyer with respect to selling orders of the said principal, in violation of 

section 4b(D) of the Commodity Exchange Act (7 U.S.C., 1952 ed., § 6b(D)); and 

failed to execute futures trades openly and competitively by open outcry in the 

trading pit of the Chicago Board of Trade, in wilful violation of section 1.38 

of the rules and regulations under the Commodity Exchange Act (17 CFR 1.38). 

IV 

On or about April 23, 1957, the respondent, having in hand orders from his 

principals, registered futures commission merchants, to purchase quantities of 

old July 1957 wheat futures on behalf of such principals, and other orders from 

such principals to sell quantities of old July 1957 wheat futures on their 

behalf, executed such orders on the Chicago Board of Trade by selling quantities 

of the said future for the account of a principal to an opposite broker and, in 

each instance, purchasing from the same opposite broker the same quantity of the 

same future for the account of the same or a different principal. The said 

trades were consummated by means of negotiation between the respondent and the 

respective opposite brokers. The principals for whom the respondent acted, the 

quantities sold and purchased, the prices, and the opposite brokers and opposite 

accounts were as follows: 

Bought Sold Opposite Opposite 

(Bushels) (Bushels) Principal Price Broker Account 

5,000 Bache $ 2.10 H.E. Gibbs H.E. Gibbs 

5,000 Bache 2.09 7/8 H.E. Gibbs H.E. Gibbs 

5,000 Bache 2.11 3/4 H.E. Gibbs H.E. Gibbs 

5,000 Bache 2.11 3/4 H.E. Gibbs H.E. Gibbs 

5,000 Bache 2.11 3/4 A.P. McGreevy A. P. McGreevy 

5,000 Reynolds 2.11 3/4 A.P. McGreevy A.P. McGreevy 

The aforesaid trades were capable of being used for hedging transactions in 

interstate commerce in wheat or the products or byproducts thereof, or for 

determining the price basis of transactions in interstate commerce in wheat, or 

for delivering wheat sold, shipped, or received in interstate commerce. 

By reason of such transactions, the respondent filled orders by offset in 

wilful violation of section 4b(D) of the Commodity Exchange Act (7 U.S.C., 1952 

ed., § 6b(D)); entered into cross trades, in wilful violation of section 4c(A) 

of the Commodity Exchange Act (7 U.S.C., 1952 ed., § 6c(A)); and failed to 

execute futures trades openly and competitively by open outcry in the trading 

pit of the Chicago Board of Trade, in wilful violation of section 1.38 of the 

rules and regulations under the Commodity Exchange Act (17 CFR 1.38). 

Therefore, the said respondent, William J. Mallers, is hereby notified to 

appear and be at a hearing to be held at 10:00 a.m., local time, on the 21st day 

of October, 1958, in Room 1200, Board of Trade Building, 141 West Jackson 

Boulevard, Chicago, Illinois, before a referee designated to conduct such 
Page 3 

hearing, and then and there show cause, if any there be, why an order should not 

be made suspending or revoking the registration of respondent 

William J. Mallers as a floor broker and directing that all contract markets 

refuse all trading privileges to the said respondent for such period of time as 

may be determined. The respondent will have twenty (20) days after the receipt 

of this notice of hearing in which to file with the Hearing Clerk, United States 

Department of Agriculture, Washington 25, D. C., an answer, with an original and 

five copies, fully and completely stating the nature of the defense and 

admitting or denying, specifically and in detail, each material and relevant 

allegation of this complaint. Allegations that are not answered will be deemed 

admitted for the purpose of this proceeding. 

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

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

Done at Washington, D. C., this 

2nd day of September, 1958. 

/s/ True D. Morse 

True D. Morse 

Acting Secretary 

LOAD-DATE: June 12, 2008 
Page 4