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Commodity Futures Trading Commission 

CEA CASES 

NAME: THOMSON AND MCKINNON 

DOCKET NUMBER: STIPULATION 2 

DATE: JULY 12, 1945 

DOCUMENT TYPE: STIPULATION OF COMPLIANCE 

UNITED STATES OF AMERICA 

BEFORE THE SECRETARY OF AGRICULTURE 

In re Thomson and McKinnon 11 Wall Street, New York, New York 

Stipulation of Compliance Under the Commodity Exchange Act No. 2 

WHEREAS, the Secretary of Agriculture has reason to believe that Thomson and 

McKinnon has violated the Commodity Exchange Act, as amended, and the rules and 

regulations of the Secretary of Agriculture promulgated thereunder; and WHEREAS, 

no complaint has been filed with respect to said violation and said Thomson and 

McKinnon desires to enter into a stipulation pursuant to the provisions of 

Section 0.4 (a) of the rules of practice under the Commodity Exchange Act: Now, 

therefore, the said Thomson and McKinnon admits that the following facts are 

true: 

(1) That, at all times hereinafter mentioned, Thomson and McKinnon was a 

partnership organized under the laws of the State of New York and was doing a 

general brokerage business in securities and commodities. 

(2) That, at all times hereinafter mentioned, Thomson and McKinnon was a 

member of a number of commodity exchanges duly designated as contract markets 

under the provisions of the Commodity Exchange Act, including the Board of Trade 

of the City of Chicago and the New York Cotton Exchange. 

(3) That, at all times hereinafter mentioned, Thomson and McKinnon was 

registered as a futures commission merchant under the provisions of the 

Commodity Exchange Act. 

(4) That, on August 22, 1941, the sum of $ 360,000 of funds segregated by 

Thomson and McKinnon for commodity customers in compliance with Section 4d (2) 

of the Commodity Exchange Act, as amended, was withdrawn from segregation. This 

withdrawal resulted in an under-segregation of such funds of commodity 

customers, which under-segregation continued during the entire period from 

August 22, 1941, to September 11, 1941. Amounts under-segregated on certain 

dates were as follows: 

August 22, 1941 - $ 112,623.18 

August 27, 1941 - 107,773.99 

August 28, 1941 - 122,376.18 

(5) That, because of inaccurate bookkeeping procedure the under-segregation 

set forth in (4) above was not discovered by Thomson and McKinnon until it had 

existed for the period set forth above. 

(6) That, on April 13, 1945, a transfer of segregated funds in the amount of 

$ 100,000 was made by Thomson and McKinnon between the New York and Chicago 

office of the firm. This transfer was erroneously recorded on the records of 

the firm with the result that the amount of money in 
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segregation was overstated by the sum of $ 100,000 from April 13, 1945, to May 

15, 1945. 

(7) As a result of the erroneous procedure described in (6) the funds of 

commodity customers were under-segregated by Thomson and McKinnon during the 

period April 13 to May 15, 1945. 

(8) Upon discovery of the under-segregation described in (6) above Thomson 

and McKinnon communicated with the New York office of the Commodity Exchange 

Authority and informed representatives of that office of the error in 

segregation procedure and the resulting under-segregation. 

In addition to admitting the foregoing facts, Thomson and McKinnon agrees to 

discontinue all acts and practices which are in violation of section 4d(2) of 

the Commodity Exchange Act, an amended, and the rules and regulations 

promulgated thereunder, and further agrees that this stipulation shall be 

admissible as evidence of acts and practices in violation of said section 4d(2) 

of the Commodity Exchange Act, as amended and the rules and regulations 

promulgated thereunder, in any subsequent proceedings brought against this firm 

in the enforcement of the provisions of the said act and regulations. 

Done at New York, New York, this 12th day of July, 1945. 

/s/ Thomson and McKinnon 

THOMSON AND McKINNON 

By: /s/ R. F. Teichgracher 

GENERAL PARTNER IN CHARGE 

NEW YORK OFFICE 

LOAD-DATE: June 16, 2008 
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