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Commodity Futures Trading Commission 

CEA CASES 

NAME: MYERS AND COMPANY, A. H. MYERS, HARRY N. HARRISON, AND GLENN G. YANCEY 

DOCKET NUMBER: 63 

DATE: SEPTEMBER 3, 1954 

DOCUMENT TYPE: COMPLAINT 

UNITED STATES DEPARTMENT OF AGRICULTURE 

BEFORE THE SECRETARY OF AGRICULTURE 

In re: Myers and Company, A. H. Myers, Harry N. Harrison, and Glenn G. Yancey, 

Respondents 

CEA Docket No. 63 

Complaint and Notice of Hearing Under the Commodity Exchange Act 

The Secretary of Agriculture has reason to believe that the respondents, 

Myers and Company, A. H. Myers, Harry N. Harrison, and Glenn G. Yancey have 

violated the provisions of the Commodity Exchange Act (7 U.S.C., Chapter I) and 

the rules and regulations made pursuant to its requirements (17 CFR, Chapter I). 

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

(7 U.S.C. 9), this complaint and notice of hearing is issued alleging as 

follows: 

I 

Respondent Myers and Company is a corporation organized under the laws of the 

State of Missouri, with offices at 1307 Waldheim Building, Kansas City, 

Missouri. At all times material to this complaint, the said corporation was a 

registered 

futures commission merchant under the Commodity Exchange Act and at all such 

times the said corporation enjoyed membership trading privileges on the Kansas 

City Board of Trade and the Board of Trade of the City of Chicago, duly 

designated contract markets under the Commodity Exchange Act. 

II 

Respondent A. H. Myers, an individual residing at 6335 Ward Parkway, Kansas 

City, Missouri, is president of the respondent corporation and manages and 

controls its business. Respondent Harry N. Harrison, an individual residing at 

the Lincoln Hotel, Lincoln, Nebraska, is vice president of the respondent 

corporation, and respondent Glenn G. Yancey, an individual residing at 5614 

Newton Read, Merriam, Kansas, is vice president in charge of cash grain 

operations of the said corporation. 

III 

The acts and transactions hereinafter described were initiated and carried 

out under the supervision and direction of respondents A. H. Myers, H. N. 

Harrison, and Glenn G. Yancey, in their capacities as officers of the respondent 

corporation. 

IV 

a. At all times between April 17, 1953, and May 27, 1954, the respondent 

corporation had on its books accounts of customers who were trading in commodity 
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futures subject to the Commodity Exchange Act and regulations, and had to its 

credit with a bank, with the Kansas City Board of Trade Clearing House, and with 

clearing or carrying brokers, varying sums of money held in segregated accounts 

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

trading profits belonging to such customers. 

b. On or about September 30, 1953, the respondent corporation was 

undersegregated to the extent of approximately $ 51,198 - that is, the total 

amount of customers' funds held in segregation as above described was 

approximately $ 51,198 less than the amount necessary to pay all credits and 

equities due to such customers. 

c. On or about October 30, 1953, the respondent corporation was 

undersegregated to the extent of approximately $ 44,444. 

d. On 82 other business days between April 17, 1953 and November 27, 1953, 

the respondent corporation was undersegregated in amounts ranging from 

approximately $ 230 on April 17, 1953 to approximately $ 50,277 on October 14, 

1953. 

e. On a number of business days between February 26, 1954 and March 31, 1954, 

the respondent corporation was under-segregated in varying amounts. 

f. At all times between April 1, 1954 and May 27, 1954, the respondent 

corporation was undersegregated in amounts ranging from approximately $ 4,628 on 

April 30 to approximately $ 20,286 on May 11, 1954. 

g. In a letter dated March 10, 1949, addressed to the respondent corporation, 

the Commodity Exchange Authority called its attention to prior improper 

practices by it with respect to the handling of customers' funds, formally 

notified the said respondent corporation that the Commodity Exchange Act and 

regulations required that the trades, funds, and contracts of customers be 

separately accounted for and not commingled with trades, funds, and contracts of 

officers of the corporation, and warned the said respondent corporation that any 

further violation of such requirements might result in the institution of formal 

proceedings. By reason of the subsequent undersegregation described above, the 

respondent corporation knowingly and wilfully failed to treat and deal with all 

money received by it to margin, guarantee, and secure the trades and contracts 

of customers, or accruing to such customers as a result of such trades and 

contracts, as belonging to such customers, and used such money to 

margin and guarantee the trades and contracts and to secure and extend the 

credit of persons other than those for whom such money was held, in violation of 

section 4d(2) of the Commodity Exchange Act (7 U.S.C. 6d(2)), and sections 1.20, 

1.21, 1.22 of the rules and regulations thereunder (17 CFR 1.20, 1.21, 1.22). 

V 

On or about Friday, August 7, 1953, the respondent corporation had to its 

credit with a bank and other depositories, segregated and identified as 

customers' funds in accordance with the requirements of the Commodity Exchange 

Act and regulations, certain sums of money sufficient to pay all credits and 

equities due to such customers, plus an additional sum in the amount of 

approximately $ 8,677.22, which represented a surplus or residual interest 

belonging to the said respondent. On or about August 10, 1953, the respondent 

corporation withdrew $ 15,000 from its segregated bank account and executed a 

written statement purporting to indicate that such withdrawal represented a loan 

or investment of customers' funds in accordance with the provisions of section 

4d(2) of the Commodity Exchange Act (7 U.S.C. 6d(2)), and sections 1.25, 1.26, 

and 1.27 of the rules and regulations thereunder (17 CFR 1.25, 1.26, 1.27). The 

said withdrawal did not represent a loan or investment of customers' 
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funds but to the extent that it exceeded the respondent corporation's residual 

interest above described, was an unauthorized and unlawful use of customers' 

money and resulted in the said corporation becoming undersegregated to the 

extent of approximately $ 7,720.94. By reason of such withdrawal and use, the 

respondent corporation knowingly and wilfully violated the aforementioned 

section of the Commodity Exchange Act, and sections 1.20, 1.21, 1.22, 1.23, 

1.25, 1.26, and 1.27 of the rules and regulations thereunder (17 CFR 1.20, 1.21, 

1.22, 1.23, 1.25, 1.26, 1.27). 

VI 

On each of the following business days, the respondent corporation failed to 

compute and its books failed to show the amount of money, securities, and 

property required to be in segregation, pursuant to the provisions of section 

1.32 of the rules and regulations under the Commodity Exchange Act (17 CFR 

1.32): 

Month Day 

June 1953 18 

Aug. 1953 10, 11, 12, 17 

Sept. 1953 15 

Nov. 1953 12, 13, 23, 25 

See original document-page 6 

Month Day 

Dec. 1953 Entire month 

Jan. 1954 4-12, inclusive 

Feb. 1954 25, 26 

Mar. 1954 1-8, inclusive 

In the letter of March 10, 1949 described in paragraph IV, the respondent 

corporation was also formally notified that the Commodity Exchange Act and 

regulations required a daily computation of segregated funds. The respondent 

corporation was therefore aware of the provisions of the aforementioned section 

of the rules and regulations, and its failure to make the required computation 

as above described constituted a knowing and willful violation of section 4d(2) 

of the Commodity Exchange Act (7 U.S.C. 6d(2)) and of the aforementioned section 

of the rules and regulations. 

VII 

On or about September 18, 1953, the respondent corporation sold 20,000 

bushels of March 1954 wheat futures on the Chicago Board of Trade for the 

account of a customer, one Mildred S. Doyle, and carried the resulting short 

position open on its books for the account of the said customer. On November 

17, 1953, the respondent corporation bought 10,000 bushels of March 1954 wheat 

futures on the Chicago Board of Trade for the account of the said customer, and 

on November 30, 1953 the respondent corporation bought 30,000 bushels of March 

1954 wheat futures on the Chicago Board of Trade for the account of the said 

customer, but failed to apply such purchases on the same days as they were made 

against the open short position of such customer and failed promptly to furnish 

to the customer a purchase and sale statement or account sale showing the 

financial results of such sales and purchases, as required by section 1.46 of 

the rules and regulations under the Commodity Exchange Act (17 CFR 1.46). By 

reason of such failure the respondent corporation wilfully violated the 

aforementioned section of the rules and regulations. 

VIII 

On September 14, 1953, the respondent corporation sold 10,000 bushels of 

March 1954 rye futures on the Chicago Board of Trade for the account of a 

customer, Central Grain and Trading Company, and carried the resulting short 

position open on its books for the account of the said customer. On or about 
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January 28, 1954, the respondent corporation bought 10,000 bushels of March 1954 

rye futures on the Chicago Board of Trade for the account of the said customer, 

but failed to apply such purchase on 

the same day against the open short position of such customer and failed 

promptly to furnish to the customer a purchase and sale statement or account 

sale showing the financial results of the said sale and purchase, as required by 

section 1.46 of the rules and regulations under the Commodity Exchange Act (17 

CFR 1.46). By reason of such failure, the respondent corporation wilfully 

violated the aforementioned section of the rules and regulations. 

IX 

a. On or about December 24, 1953, the respondent corporation purchased 10,000 

bushels of March 1954 wheat futures on the Chicago Board of Trade for the 

account of a customer, one Veronica Stark, and carried the resulting long 

position open on its books for the account of the said customer. On January 17, 

1954, the respondent corporation sold 5,000 bushels of March 1954 wheat futures 

on the Chicago Board of Trade for the account of the said customer but failed to 

apply such sale on the same day against the open long position of such customer 

and failed promptly to furnish to the said customer a purchase and sale 

statement or account sale showing the financial results of the said purchase and 

sale, as required by section 1.46 of the rules and regulations under the 

Commodity Exchange Act (17 CFR 1.46). By reason of such failure the respondent 

corporation wilfully violated the aforementioned section of the rules and 

regulations. 

b. On or about January 7, 1954, the respondent corporation sold 10,000 

bushels of May 1954 wheat futures on the Chicago Board of Trade for the account 

of the said Veronica Stark, and carried the resulting short position open on its 

books for her account. On January 13, 1954, the respondent corporation bought 

5,000 bushels of May 1954 wheat futures on the Chicago Board of Trade and on 

January 14, 1954, the respondent corporation bought an additional 5,000 bushels 

of January 1954 wheat futures on the Chicago Board of Trade, both purchases 

being made for the account of the said Veronica Stark. The respondent 

corporation failed to apply such purchases on the same days as they were made 

against the open short position of the said Veronica Stark and failed promptly 

to furnish to her a purchase and sale statement or account sale showing the 

financial result of such purchase and sale, as required by section 1.46 of the 

rules and regulations under the Commodity Exchange Act (17 CFR 1.46). By reason 

of such failure, the respondent corporation wilfully violated the aforementioned 

section of the rules and regulations. 

Therefore, the said respondents, Myers and Company, A. H. Myers, Harry N. 

Harrison, and Glenn G. Yancey, are hereby notified to be and appear at a hearing 

to be held at 10 a.m., Central Standard Time, on the 4th day of November, 1954, 

in Room 854, Board of Trade Building, Kansas City, Missouri, before a referee 

designated 

 

to conduct such hearing and then and there show cause, if any there be, why an 

order should not be made revoking or suspending the registration of respondent 

Myers and Company as a futures commission merchant, and directing that all 

contract markets refuse all trading privileges to all the respondents for such 

period of time as may be determined. 

The respondents will have 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., in triplicate, an answer 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 
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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 

respondents by delivery of a true copy thereof by an employee of the Department 

of Agriculture, or by registered mail, at least 20 days prior to the date set 

for hearing. 

Done at Washington, D. C., this 

3rd day of September, 1954 

/s/ Earl L. Butz 

Acting Secretary of Agriculture 

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