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Commodity Futures Trading Commission 

CEA CASES 

NAME: PACIFIC WEST COMMODITIES, INC., KENNETH M. MUELLER, BETHEL G. BUCKALEW, 

NORMAN C. LONG, AND LESTER J. SUTER 

DOCKET NUMBER: 128 

DATE: JULY 21, 1965 

DOCUMENT TYPE: COMPLAINT 

UNITED STATES DEPARTMENT OF AGRICULTURE 

BEFORE THE SECRETARY OF AGRICULTURE 

In re: Pacific West Commodities, Inc., Kenneth M. Mueller, Bethel G. Buckalew, 

Norman C. Long, and Lester J. Suter, Respondents 

CEA Docket No. 128 

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

Act 

There is reason to believe that the respondents, Pacific West Commodities, 

Inc., Kenneth M. Mueller, Bethel G. Buckalew, Norman C. Long, and Lester J. 

Suter, have violated the Commodity Exchange Act (7 U.S.C. 1 et seq.) and the 

regulations made pursuant thereto (17 CFR, Part 1), and in accordance with the 

provisions of section 6(b) of the said act (7 U.S.C. 9), this complaint and 

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

I 

Respondent Pacific West Commodities, Inc., is a California corporation with 

its principal office and place of business at 1250 Prospect Street, La Jolla, 

California. The said corporation is now and was at all times material to this 

complaint a registered futures commission merchant under the Commodity Exchange 

Act. 

II 

Respondents Kenneth M. Mueller, Bethel G. Buckalew, Norman C. Long, and 

Lester J. Suter, individuals, whose business address is 1250 Prospect Street, La 

Jolla, California, are now and were at all times material to this complaint the 

president, executive vice president, vice president-treasurer, and secretary, 

respectively, of the respondent corporation. Respondent Kenneth M. Mueller was 

at all times material to this complaint a member of the Board of Trade of the 

City of Chicago, a duly designated contract market under the Commodity Exchange 

Act. 

III 

The acts and transactions hereinafter described were ordered by, or carried 

out by means of the acts of, or subject to the supervision and control of, 

Kenneth M. Mueller, Bethel G. Buckalew, Norman C. Long, and Lester J. Suter, 

acting in their capacities as officers of the respondent corporation. 

IV 

At the times hereinafter stated, respondent Pacific West Commodities, Inc., 

in the regular course of its business as a futures commission merchant, carried 

accounts of customers who traded in commodity futures subject to the provisions 

of the Commodity Exchange Act and regulations. At all such times, the said 

respondent had to 
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its credit with a bank or other depository, sums of money in varying amounts, 

held in segregated accounts and identified as customers' funds, representing 

deposits of margins by and trading profits accruing to such customers. 

V 

On 46 business days during the period from January 29, 1965, through June 15, 

1965, respondent Pacific West Commodities, Inc., was undersegregated in amounts 

ranging up to approximately $ 31,600 on June 15, 1965, that is, the total amount 

of customers' funds held in segregation as described in paragraph IV above, was 

insufficient, by such amounts, to pay all credits and equities due to such 

customers. 

VI 

On 24 business days during the period referred to in paragraph V above, 

respondent Pacific West Commodities, Inc., failed to make any computations or 

permanent record of the amount of money, securities, and property required to be 

held in segregated account in order to pay all credits and equities due to its 

customers. 

VII 

Beginning on or about December 1, 1964, and continuing until on or about June 

10, 1965, respondent Pacific West Commodities, Inc., made purchases and sales of 

commodity futures for its own use and benefit, and placed such trades in its 

customers' account carried by a correspondent firm, by reason of which the open 

contract positions 

and financial results of such trades were commingled with the open contract 

positions and financial results of the transactions of the customers of the 

respondent corporation. 

VIII 

During the period from January 29, 1965, through June 15, 1965, respondent 

Pacific West Commodities, Inc., purchased and sold commodity futures for the use 

and benefit of certain customers and margined, guaranteed, or secured such 

purchases and sales with funds belonging to other customers of the respondent 

firm. 

IX 

By reason of the acts and omissions described in this complaint, respondents 

Pacific West Commodities, Inc., Kenneth M. Mueller, Bethel G. Buckalew, Norman 

C. Long, and Lester J. Suter failed to treat and deal with customers' funds as 

belonging to such customers, failed to segregate and account separately for such 

funds, used funds to margin or guarantee the trades or secure or extend the 

credit of customers other than those for whom such funds were held, commingled 

customers' funds with funds belonging to the respondent corporation, and failed 

to prepare and maintain the records required under the Commodity Exchange Act 

and regulations as a basis for such segregation and accounting, in willful 

violation of sections 4d(2) and 4g of the Commodity Exchange Act (7 U.S.C. 

6d(2), 6g) and sections 1.20, 1.21, 1.22, 1.23 and 1.32 of the regulations (17 

CFR 1.20, 1.21, 1.22, 1.23, 1.32). 

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

served upon the said respondents. 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 six 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 
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purpose 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 

respondents are hereby notified that unless hearing is waived, either expressly 

or by failure to file an answer, or by filing an answer in which all of the 

material allegations of fact contained in the complaint are admitted and a 

hearing is not requested, a hearing will be held at 10:00 a.m., local time, on 

the first day of September 1965, in La Jolla, California, 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 order should not be made directing that all contract 

markets refuse all trading privileges to all the respondents for such period of 

time as may be determined, and suspending or revoking the registration of 

respondent Pacific West Commodities, Inc., as a 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., 

on July 21, 1965. 

[SEE SIGNATURE IN ORIGINAL] 

Assistant Secretary 

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