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Commodity Futures Trading Commission 

CEA CASES 

NAME: CONTINENTAL GRAIN COMPANY, JULIUS MAYER AND SELWYN S. UNELL 

DOCKET NUMBER: 84 

DATE: MAY 12, 1958 

DOCUMENT TYPE: COMPLAINT 

UNITED STATES DEPARTMENT OF AGRICULTURE 

BEFORE THE SECRETARY OF AGRICULTURE 

In re: Continental Grain Company, Julius Mayer, and Selwyn S. Unell, Respondents 

CEA Docket No. 84 

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

Act 

There is reason to believe that the respondents, Continental Grain Company, 

Julius Mayer, and Selwyn S. Unell, attempted to manipulate and did manipulate 

the price of a commodity in interstate commerce and for future delivery on or 

subject to the rules of a board of trade, in violation of the Commodity Exchange 

Act (7 U.S.C. 1952 ed., §§ 9, 13), and in accordance with the provisions of 

section 6(b) of the said 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 Continental Grain Company, hereinafter called Continental, is now 

and was at all times material herein a corporation organized under the laws of 

the State of Delaware, with its principal office and place of business at 141 

West Jackson Boulevard, Chicago 4, Illinois, and branch offices throughout the 

United States. The said corporation is now and was at all such times engaged in 

business as 

a merchant, receiver, shipper, broker, warehouseman, importer and exporter of 

grain and other commodities, buying and selling grain through its various 

offices and trading in grain for future delivery for its own account on boards 

of trade in the United States, including the Board of Trade of the City of 

Chicago. The said corporation is now and was at all such times a clearing 

member of the Board of Trade of the City of Chicago, and a registered futures 

commission merchant under the Commodity Exchange Act. 

II 

Respondent Julius Mayer, an individual whose address is 912 Skokie Ridge 

Drive, Glencoe, Illinois, is now and was at all times material herein the 

executive vice president of Continental, a member of the Board of Trade of the 

City of Chicago, and a registered floor broker under the Commodity Exchange Act. 

Respondent Selwyn S. Unell, an individual whose address is 710 Hinman Avenue, 

Evanston, Illinois, is now and was at all times material herein a member of the 

Board of Trade of the City of Chicago and a registered floor broker under the 

Commodity Exchange Act. 

III 

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

Board of Trade, is now and was at all times material herein a duly designated 

contract market under the Commodity Exchange Act. 
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IV 

On September 13, 1957, the Commodity Credit Corporation, an instrumentality 

of the United States Government, hereinafter called Commodity, pursuant to prior 

announcement and in accordance with its usual practice, was selling cash corn on 

bids at flat prices submitted to it not later than 2:30 p.m., on that day. 

Under the pricing method used by Commodity, and well known to the grain trade, 

including Continental, the lowest acceptable bid price was a price equivalent to 

the settlement price of the September 1957 corn future on the Chicago Board of 

Trade on the day of the bid, plus a premium applicable to the specified point of 

delivery. 

V 

On September 13, 1957, shortly before the close of the trading session on the 

Chicago Board of Trade, respondent Selwyn S. Unell, acting on behalf of 

Continental and pursuant to orders and instructions given to him by respondent 

Julius Mayer, made a series of rapid and successive offers of the September 1957 

corn future on a descending price scale on the floor of the Chicago Board of 

Trade, in the course of which he sold 200,000 bushels of such future at prices 

ranging from $ 1.24 down to $ 1.22 1/2 per bushel, including a sale of 20,000 

bushels at $ 1.22 1/2 per bushel to respondent Julius Mayer, also 

acting for Continental. At approximately 1:15 p.m., at the conclusion of the 

said series of offers and sales, the trading session closed. The closing price 

range of the said future was $ 1.23 - $ 1.22 1/2 per bushel, and on the basis of 

this closing price range the settlement price was established at $ 1.22 3/4 per 

bushel. Subsequent thereto and before 2:30 p.m., Continental submitted bids to 

Commodity for a total of 700,000 bushels of cash corn at prices equivalent to $ 

1.22 3/4 per bushel plus the applicable premiums, and such bids were accepted by 

Commodity and the said quantity of cash corn was thereupon sold to Continental. 

VI 

The offers and sales of September 1957 corn futures described in paragraph V 

were initiated and ordered by respondents Continental Grain Company and Julius 

Mayer, and were entered into and executed for Continental's account by 

respondents Julius Mayer and Selwyn S. Unell, for the purpose and with the 

intent of depressing the price of the September 1957 corn future on the Chicago 

Board of Trade and bringing about a lower closing price for such future than 

would otherwise prevail, in order to enable Continental to bid for and purchase 

cash corn from Commodity at lower prices, and such offers and sales caused 

unjustified decreases in the price of such future 

and in the price of cash corn sold by Commodity. By reason of such acts, the 

respondents attempted to manipulate and did in fact manipulate the price of corn 

in interstate commerce and for future delivery on or subject to the rules of a 

board of trade, in wilful violation of sections 6(b) and 9 of the Commodity 

Exchange Act (7 U.S.C. 1952 ed., §§ 9, 13). 

VII 

The sale of 20,000 bushels of September 1957 corn futures by respondent 

Selwyn S. Unell for the account of Continental, to respondent Julius Mayer for 

the account of Continental, described in paragraph V, was not a bona fide sale 

and purchase but was entered into and consummated for the purpose and with the 

intent of establishing a price quotation. By reason of such acts, the 

respondents offered to enter into and entered into a transaction which was a 

wash sale or fictitious sale, in wilful violation of section 4c of the Commodity 

Exchange Act (7 U.S.C. 1952 ed., § 6c). 
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Therefore the said respondents, Continental Grain Company, Julius Mayer, and 

Selwyn S. Unell, are hereby notified to be and appear at a hearing to be held at 

10:00 a.m., local time, on the 

29th day of July, 1958, at Room 1200, Board of Trade Building, Chicago, 

Illinois, 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 suspending or 

revoking the registration of respondent Continental Grain Company as a futures 

commission merchant, suspending or revoking the registrations of respondents 

Julius Mayer and Selwyn S. Unell as floor brokers, and directing that all 

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

period of time as may be determined. 

The respondents 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 seven 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 to have been 

admitted for the purpose of this proceeding. Failure to file an answer will 

constitute a waiver of hearing. 

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., this 

12th day of May, 1958. 

/s/ Don Paarlberg 

Don Paarlberg 

Assistant Secretary 

163 

GRAIN 

WASHINGTON (AP)-THE AGRICULTURE DEPARTMENT TODAY IMPOSED PENALTIES ON THE 

CONTINENTAL GRAIN CO. OF CHICAGO, A COMPANY OFFICER AND A CHICAGO FLOUR BROKER 

FOR ALLEGED MANIPULATION OF GRAIN PRICES ON KANSAS CITY AND CHICAGO COMMODITY 

FUTURES MARKETS. 

THE ORDER WAS ISSUED WITH THE CONSENT -- THAT IS THE ACCEPTANCE -- OF THOSE 

NAMED. 

EFFECTIVE NOV. 21, THE ORDER SUSPENDS FOR 90 DAYS THE REGISTRATION OF THE BIG 

GRAIN COMPANY AS A COMMISSION FUTURES MERCHANT. IT DIRECTS THE KANSAS CITY 

BOARD OF TRADE TO REFUSE THE COMPANY ALL TRADING PRIVILEGES IN WHEAT AND THE 

CHICAGO BOARD OF TRADE TO REFUSE IT ALL TRADING PRIVILEGES IN CORN DURING THE 

SAME PERIOD. 

THE ORDER ALSO SUSPENDS FOR 90 DAYS THE REGISTRATION OF JULIUS MAYER, 

EXECUTIVE VICE PRESIDENT OF THE COMPANY, AS A FLOOR BROKER, AND DIRECTS REFUSAL 

OF ALL TRADING PRIVILEGES TO HIM ON ALL CONTRACT MARKETS FOR THE SAME PERIODS. 

IT ALSO SUSPENDS THE REGISTRATION OF SELWYN S. UNELL, OF CHICAGO, AS A FLOOR 

BROKER FOR 30 DAYS AND DIRECTS THAT HE BE DENIED ALL TRADING PRIVILEGES ON ALL 

CONTRACT MARKETS FOR THE SAME PERIOD. 

MC354P 9-25 

WASHINGTON -- AND GRAIN (163) 
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IN A COMPLAINT FILED APRIL 30, 1956, THE DEPARTMENT CHARGED THAT CONTINENTAL 

GRAIN CO. MANIPULATED THE PRICE OF WHEAT FUTURES CONTRACTS ON THE KANSAS CITY 

BOARD OF TRADE ON JAN. 26, 1955, AND ON NOV. 30, 1955. THE DEPARTMENT ON MAY 

12, 1958 ALSO CHARGED THAT THE COMPANY, MAYER AND UNELL MANIPULATED THE PRICES 

OF CASH CORN AND OF CORN FUTURES ON THE CHICAGO BOARD OF TRADE ON SEPT. 13, 

1957. 

HEARINGS ON THE FIRST COMPLAINT WERE HELD IN KANSAS CITY AND CHICAGO IN 1956 

AND 1957. HEARINGS ON THE LATTER COMPLAINT WERE SCHEDULED TO BEGIN IN CHICAGO 

ON NOV. 18. 

THE DEPARTMENT SAID THE COMPANY AND THE TWO INDIVIDUALS WAIVED ALL FURTHER 

HEARINGS AND CONSENTED TO ISSUANCE OF THE ORDER. 

MC359P 9-25 

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