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Commodity Futures Trading Commission 

CEA CASES 

NAME: WALKER & CO. 

DOCKET NUMBER: 201 

DATE: SEPTEMBER 11, 1972 

DOCUMENT TYPE: COMPLAINT 

UNITED STATES DEPARTMENT OF AGRICULTURE 

BEFORE THE SECRETARY OF AGRICULTURE 

In re: Walker & Co., Respondent 

CEA Docket No. 201 

Complaint and Notice of Hearing Under the Commodity Exchange Act 

There is reason to believe that the respondent has violated the Commodity 

Exchange Act (7 U.S.C. 1 et seq.) and the regulations made pursuant thereto, and 

this complaint and notice of hearing is issued stating the charges in that 

respect as follows: 

I 

Respondent Walker & Co,, a partnership with offices at 470 Atlantic Avenue, 

Boston, Massachusetts, is now, and was at all times material herein, a 

registered futures commission merchant under the Commodity Exchange Act. 

II 

(a) At all times material herein, the respondent, in the regular course of 

its business as futures commission merchant, carried accounts of customers who 

traded in commodity futures on contract markets subject to the provisions of the 

Commodity Exchange Act and the regulations thereunder. Such accounts, the 

trading therein, and the handling and disposition of funds in connection 

therewith, were subject to the provisions of the said Act and regulations. 

At all such times, the respondent had to its credit with banks or other 

depositories, money and securities in varying amounts, held in segregated 

accounts and identified as customers' funds, representing deposits of margin by 

and trading profits accruing to such customers. 

(b) Examination of the records of the respondent by the Commodity Exchange 

Authority disclosed as shown in the tabulation below, (1) that during the period 

from March 31 through May 26, 1971, the respondent was under segregated on eight 

days in amounts within the range of $ 10,524.27 on April 1 to $ 158,236.54 on 

May 26 - that is, the total amount of customers' funds held in segregation as 

described above was insufficient, by the aforesaid sums, to pay all credits and 

equities due to such customers; and (2) that on nine days during that period the 

daily computation and record that was prepared and kept by the respondent to 

meet the requirements of section 1.32 of the regulations under the Commodity 

Exchange Act (17 CFR 1.32) contained errors which resulted in gross 

misstatements of the respondent's segregated condition: 

Respondent's 

Date Segregation Record Per CEA Examination

(Undersegregation) (Undersegregation) 

Oversegregation Oversegregation 

March 31 (39,676.42) (11,309.35) 

April 1 (48,871.02) (10,524.27) 

 
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Respondent's Date Segregation Record Per CEA Examination

(Undersegregation) (Undersegregation) 

Oversegregation Oversegregation 

April 26 (53,475.04) (24,782.78) 

April 27 (51,119.99) (22,344.61) 

April 28 (49,870.43) (21,343.84) 

April 29 (174,059.03) (145,545.21) 

May 5 (3,445.64) 23,689.21 

May 25 (197,550.49) (145,493.80) 

May 26 115,874.89 (158,236.54) 

III 

By reason of the facts alleged in this complaint, the respondent violated 

sections 4d and 4g of the Commodity Exchange Act (7 U.S.C. 6d, 6g), and sections 

1.20, 1.21, 1.22, 1.32 and 1.35 of the regulations thereunder (17 CFR 1.20, 

1.21, 1.22, 1.23, 1.32, 1.35). 

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

served upon the respondent 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 

respondent 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 three 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 respondent is hereby notified that unless 

hearing is waived, a hearing will be held in Boston, Massachusetts, at a place 

therein and date to be specified later, before a referee designated to conduct 

such hearing. At such hearing, the respondent 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 directing that the respondent shall 

cease and desist from violating the Act and regulations in the manner alleged 

herein. 

Done at Washington, D. C. 

September 11, 1972. 

[SEE SIGNATURE IN ORIGINAL] 

Philip C. Olsson 

Deputy Assistant 

Secretary 

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