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Commodity Futures Trading Commission 

CEA CASES 

NAME: GARVEY GRAIN, INC. 

DOCKET NUMBER: STIPULATION 105 

DATE: APRIL 29, 1968 

DOCUMENT TYPE: STIPULATION OF COMPLIANCE 

UNITED STATES DEPARTMENT OF AGRICULTURE 

BEFORE THE SECRETARY OF AGRICULTURE 

In re: Garvey Grain, Inc. 

Stipulation of Compliance 

Under the Commodity Exchange Act No. 105 

The Secretary of Agriculture has reason to believe that Garvey Grain, Inc. 

has violated the provisions of the Commodity Exchange Act (7 U.S.C., Chapter 1) 

and the regulations of the Secretary of Agriculture promulgated thereunder. No 

complaint with respect to such violations has been issued and the said Garvey 

Grain, Inc. is desirous of disposing of the matter by entering into a 

stipulation of compliance as authorized by section 0.4(a) of the Rules of 

Practice under the Commodity Exchange Act (17 CFR, Part 0). Therefore, the said 

Garvey Grain, Inc. stipulates the following facts are true: 

(1) Garvey Grain, Inc. is now and was at all times mentioned herein a 

registered futures commission merchant under the Commodity Exchange Act with an 

office and principal place of business at 300 W. Douglas, Wichita, Kansas 67202 

and a branch office at 1680 Board of Trade Building, 141 West Jackson Boulevard, 

Chicago, Illinois 60604. 

(2) As of March 15, 16, and 17, 1967, Garvey Grain, Inc. was undersegregated 

in the amounts of $ 2,234.89, $ 61,052.64 and 

$ 60,945.14, respectively. That is, the total amounts of customers' funds held 

in segregation in order to comply with requirements of section 4d(2) of the 

Commodity Exchange Act was insufficient, by the above amounts, to pay all 

credits and equities to customers. 

(3) As of January 3 and 5, 1968, as a result of the manner in which it 

handled receipts on futures contracts for customers' accounts, Garvey Grain, 

Inc. was undersegregated in the amounts of $ 160,653.19 and $ 82,844.14, 

respectively. That is, the total amounts of customers' funds held in 

segregation in order to comply with the requirements of section 4d(2) of the 

Commodity Exchange Act was insufficient, by the above amounts, to pay all 

credits and equities due customers. 

(4) Garvey Grain, Inc. failed to compute and keep a record as of the close of 

the market on any business day from June 1 through June 29, 1967, showing the 

amount of money, securities and property owing or accruing to its customers 

which it was required to have in segregated account for such customers in order 

to comply with the requirements of section 4d(2) of the Commodity Exchange Act. 

(5) A previous instance of undersegregation as described in paragraph (2) 

above in the amount of $ 24,269.25, occurred on June 20, 1966. Previous 

failures to compute and keep the daily 
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segregation record as described in paragraph (4) above occurred on five business 

days during the period June 24, 1966 through June 30, 1966, and on July 6 and 7, 

1966. The previous instance of undersegregation and the earlier failures to 

compute and keep the daily segregation record were discussed with Mr. Robert J. 

Kuerten, an Assistant Treasurer of Garvey Grain, Inc. These matters were 

further brought to his attention in a letter dated July 26, 1966, from the 

Director, Accounting and Licensing Division, Commodity Exchange Authority. On 

28 consecutive business days from September 18, 1962 to October 25, 1962, Garvey 

Grain, Inc. did not compute and keep the daily segregation record as described 

above. This failure was also discussed with Mr. Robert J. Kuerten. 

The Commodity Exchange Authority has advised Garvey Grain, Inc. that the 

undersegregation described in paragraphs (2) and (3) above and the failure to 

compute and keep a record as described in paragraph (4) above was in violation 

of section 4d(2) of the Commodity Exchange Act and section 1.32 of the 

regulations thereunder. 

The said Garvey Grain, Inc. agrees to desist from such acts and practices in 

the future. It further understands and agrees that this stipulation is 

admissible as evidence of such acts and practices in any future proceeding based 

upon acts or practices 

in addition to those referred to herein which may be brought by the Secretary of 

Agriculture against it under the provisions of the said act. Garvey Grain, Inc. 

also understands that it is the practice of the Commodity Exchange Authority to 

issue press releases on stipulations of compliance and to make them a matter of 

public record. 

Done at WICHITA , this 

29TH day of APRIL 1968 

Garvey Grain, Inc. 

By: [SEE SIGNATURE IN ORIGINAL] 

Witnessed by: [SEE SIGNATURE IN ORIGINAL] 

LOAD-DATE: June 12, 2008 
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