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Commodity Futures Trading Commission 

CEA CASES 

NAME: MARVIN SPERLING 

CITATION: 31 Agric. Dec. 377 

DOCKET NUMBER: 177 

DATE: MARCH 6, 1972 

DOCUMENT TYPE: DECISION AND ORDER 

(No. 14,454) 

In re MARVIN SPERLING. CEA Docket No. 177. Decided March 6, 1972. 

Misuse of customers' funds -- Denial of trading privileges for 3 years

Respondent is ordered to cease and desist from using customers' funds for 

unauthorized purposes and is prohibited from trading on all the contract markets 

for a period of 3 years. 

John Broadley for Commodity Exchange Authority. 

Respondent pro se.

Jack W. Bain, Chief Hearing Examiner. 

Decision by Donald A. Campbell, Judicial Officer

DECISION AND ORDER

This is a proceeding under the Commodity Exchange Act (7 U.S.C. Chapter 1, 

1970 ed.). 

The complaint in this case was served on the respondent's attorney, in 

accordance with a telephone request from the respondent. The respondent's 

attorney filed an answer, but subsequently advised the compainant that "the 

respondent herein has informed this firm that he will not retain our services in 

connection with the above entitled proceeding." 

Subsequent documents were served on the respondent by mailing a copy to him 

at his last known address, by certified or registered mail, but they were 

returned "Unclaimed," or "Moved, left no address." 

The respondent did not appear at the hearing and filed no exceptions to the 

Hearing Examiner's report. The Hearing Examiner's report was mailed to the 

respondent at his last known address, by registered mail, but was returned 

marked "Moved, left no address." The rules of practice provide for various forms 

of service of documents in connection with disciplinary proceedings, including 

service "by registering and mailing a copy of the document or paper, addressed 

to such indvidual, partnership, corporation, organization, or association, or to 

his or its attorney or agent of record, at his or its last known principal 

office, place of business, or residence" (17 CFR § 0.22(b)). 

In view of the foregoing, and after consideration of the entire record, the 

recommended decision and proposed order of the Hearing Examiner are adopted as 

the final decision and order herein. The order shall become effective on the 

30th day after the date of this order. 

A copy of this decision and order shall be served on each contract market, 

and on the respondent, by sending a copy to him at his last known address, 

registered mail. 
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CHIEF HEARING EXAMINER'S RECOMMENDED DECISION AND ORDER

PRELIMINARY STATEMENT

This is a proceeding under the Commodity Exchange Act (7 U.S.C. Chapter 1), 

hereinafter called the Act. It was instituted by a complaint and notice of 

hearing filed on August 10, 1971, by an Assistant Secretary of Agriculture. The 

Respondent was charged with converting customers' funds to his own use, in 

violation of the Act and the regulations thereunder. Respondent filed an answer 

denying violation of the Act and requesting an oral hearing. 

An oral hearing was held in Washington, D.C., on December 1, 1971, before 

Chief Hearing Examiner Jack W. Bain, Office of Hearing Examiners, United States 

Department of Agriculture. John Broadley, Office of the General Counsel of the 

Department, appeared for Complainant. Although duly notified of the time 

and place of the hearing, Respondent did not appear, and no evidence was 

presented on his behalf. Complainant called two witnesses and introduced five 

exhibits in evidence. 

After the hearing, Complainant filed suggested findings of fact, etc., which 

substantially are proposed below. 

PROPOSED FINDINGS OF FACT

1. The Respondent, Marvin Sperling, an individual whose last known address 

was 12334 Rossridge, St. Louis, Missouri 63141, was at all times material herein 

a member of the New York Mercantile Exchange and an employee of Jacobson 

Commodities, Inc., a registered futures commission merchant under the Commodity 

Exchange Act. 

2. The New York Mercantile Exchange is now and was at all times material 

herein a duly designated contract market under the Commodity Exchange Act. 

3. On or about December 27, 1968, Respondent converted to his own use $ 

600.00, which he had received and accepted from William Dalton to margin, 

guarantee, and secure transactions in commodities for future delivery to be 

executed on the New York Mercantile Exchange for Dalton's account, which was 

carried with Jacobson Commodities, Inc. 

4. On or about January 16, 1969, Respondent converted to his own use $ 600.00 

which he had received and accepted from Raymond Geisler to margin, guarantee, 

and secure transactions in commodities for future delivery to be executed on the 

New York Mercantile Exchange for an account to be opened in the name of Geisler 

with Jacobson Commodities, Inc. 

5. The aforesaid transactions in commodities for future delivery could have 

been used for hedging transactions in interstate commerce in such commodities, 

or for delivering such commodities sold, shipped, or received in interstate 

commerce. 

PROPOSED CONCLUSIONS

The Complainant's suggested findings of fact are plainly established by the 

evidence. These findings clearly demonstrate that, as charged in the complaint, 

the Respondent violated sections 4b, 4d and 9 of the Commodity Exchange Act (7 

U.S.C. 6b, 6d and 13), and section 1.20 of the regulations made pursuant thereto 

(17 CFR 1.20). See, e.g., In re Jack C. Flora, 29 Agric. Dec. 1015 (29 A.D. 

1015) 

(1970); In re Sterling Securities, Inc. et al., 28 Agric. Dec. 115 (28 A.D. 115) 

(1969); In re Douglas Steen, 21 Agric. Dec. 1076 (21 A.D. 1076) (1962). 

The offenses by the Respondent were deliberate, serious and flagrant. They 

violated basic provisions of the Commodity Exchange Act designed for the 
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protection of customers of futures commission merchants. Upon a consideration 

of all the facts and circumstances of this case, we agree with the testimony of 

the Director of the Compliance Division of the Commodity Exchange Authority that 

in order to effectuate the purposes of the Commodity Exchange Act, it is 

necessary to deny to the Respondent all trading privileges on contract markets 

for a period of three years and to enter a cease and desist order against him. 

PROPOSED ORDER

1. The Respondent, Marvin Sperling, shall cease and desist from (a) 

converting to his own use or the use of another, any funds received by the 

Respondent as futures commission merchant or as the employee or agent of a 

futures commission merchant to margin, secure or guarantee the trades or 

contracts of any customer of the Respondent or of such other futures commission 

merchant or accruing to such customer as the result of such trades or contracts, 

and (b) using any funds held by any futures commission merchant for any 

customer, as belonging to any person other than the customer for whom such funds 

are held. 

2. The Respondent, Marvin Sperling, is prohibited from trading on or subject 

to the rules of any contract market for a period of three years, and all 

contract markets shall refuse all trading privileges to the Respondent during 

this period, such prohibition and refusal to apply to all trading done and all 

positions held by the Respondent, directly or indirectly. 

The cease and desist provisions of this order shall become effective upon the 

date of service of this order upon the Respondent. 

The period of the denial of trading privileges to the Respondent specified in 

paragraph 2 above shall become effective on the thirtieth day after the date of 

entry of this order. 

A copy of this decision and order shall be served upon each contract market. 

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