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Commodity Futures Trading Commission 

CEA CASES 

NAME: PROFESSIONAL COMMODITY SERVICE, INC. AND THEODORE W LORD, SR. 

CITATION: 33 Agric. Dec. 14 

DOCKET NUMBER: 193 

DATE: JANUARY 25, 1974 

DOCUMENT TYPE: DECISION AND ORDER 

(No. 15,614) 

In re PROFESSIONAL COMMODITY SERVICE, INC. and THEODORE W LORD, SR. CEA Docket 

No. 193. Decided January 25, 1974. 

Minimum financial requirements -- failure to meet -- Stipulation of 

respondent corporation -- Application for registration by corporation -- denial 

of -- Cease and desist order against respondent corporation -- Termination of 

proceeding against respondent Theodore W. Lord, Sr., now deceased, without 

action

Where respondent corporation Professional Commodity Service, Inc., wilfully 

omitted to state in its financial report the material facts required to be 

stated therein and, further, does not meet the financial requirements of the 

Act, this respondent's application for registration as a futures commission 

merchant under the Act is denied. 

Darrold A. Dandy, for complainant. 

David R. Johnson, Denver, Colorado, for respondent. 

Decision by John G. Liebert, Administrative Law Judge.

DECISION AND ORDER

PRELIMINARY STATEMENT

This is an administrative proceeding under the Commodity 

Exchange Act (7 U.S.C. Chapter 1), instituted by a Complaint and Notice of 

Hearing which alleges that the respondent corporation, by its President, 

respondent Theodore W. Lord, Sr., filed a request for registration as a futures 

commission merchant under the Commodity Exchange Act and that (1) the applicant 

failed to meet the minimum financial requirements for registration pursuant to 

section 4f of the Act (7 U.S.C. 6f) and section 1.17(a) of the regulations 

issued pursuant thereto (17 CFR 1.17(a)), and (2) the applicant wilfully omitted 

to state a material fact required to be stated in such application in violation 

of section 6(b) of the Act (7 U.S.C. 9). 

Hearing on this matter was held in Denver, Colorado, on September 7, 1972, 

before Administrative Law Judge John G. Liebert, acting as Referee. No final 

Decision and Order has been issued and this matter has been remanded for further 

proceedings. No further hearings have been held pursuant to the order of the 

Judicial Officer issued on March 30, 1973. Respondent Theodore W. Lord, Sr., 

suffered a fatal heart attack on November 7, 1973. Respondent Professional 

Commodity Service, Inc., has filed a stipulation in which it (1) admits the 

facts hereinafter set forth in paragraphs 1 and 2 of the Findings of Fact 

insofar as they relate to it, (2) admits, for the purposes of this proceeding 

and for such purposes only, the remaining facts set forth in the Findings of 
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Fact, (3) waives further oral hearing on the charges in the complaint, and (4) 

consents to the entry, without further proceeding, of a Decision and Order 

containing the facts admitted in such stipulation as the Findings of Fact, 

conclusions of law based on such Findings and the order container herein. 

FINDINGS OF FACT

1. Respondent Professional Commodity Service, Inc., a Colorado corporation 

with offices at 1776 South Jackson, Denver, Colorado 80210, has applied for 

registration as futures commission merchant under the Commodity Exchange Act but 

registration has not been granted. 

2. Respondent Theodore W. Lord, Sr. was at all times material herein, 

president of the respondent corporation and had responsibility for the 

management of the corporate respondent. 

3. The respondent corporation has not established that it meets the minimum 

financial requirements under section 4f of the Commodity Exchange Act (7 U.S.C. 

12a) and section 1.17 of the regulations issued pursuant to the Act (17 CFR 

1.17). The 

respondent corporation's current liabilities exceeded its current assets by 

approximately $ 9,000.00 on November 17, 1971, and it lacked approximately $ 

5,000.00 on July 23, 1971, $ 19,000.00 on November 17, 1971, $ 2,800.00 on March 

31, 1972, and $ 5,000.00 on April 10, 1972, of having enough working capital to 

meet such minimum financial requirements. 

4. The respondents, in connection with the respondent corporation's 

application for registration as futures commission merchant, filed with the 

Commodity Exchange Authority a financial report on Form 1-FR, which purported to 

show the firm's financial condition as of July 23, 1971. The respondent 

wilfully omitted to state in such report material facts required to be stated 

therein. Such omitted material facts were as follows: 

a. On July 23, 1971, the respondent drew a check to the order of respondent 

Theodore W. Lord, Sr., for $ 15,000.00 on the respondent firm's general funds 

bank account, which check was subsequently negotiated by respondent Lord. 

b. On July 23, 1971, the respondent corporation obtained a loan from the 

Security National Bank, Denver, Colorado, in the amount of $ 5,000.00 which, by 

the terms of the promissory note signed by the respondent corporation, was due 

and payable on October 21, 1971, with interest at the rate of 7 percent per 

annum. 

CONCLUSIONS

By reason of the facts set forth in the Findings of Fact, it is concluded 

that the respondent Professional Commodity Service, Inc., as charged in the 

complaint, (1) has not established that it meets the minimum financial 

requirements under section 4f of the Commodity Exchange Act (7 U.S.C. 6f) and 

section 1.17 of the regulations (17 CFR 1.17); (2) does not now meet such 

minimum financial requirements; (3) wilfully omitted to state in a report filed 

with the Commodity Exchange Authority a material fact required to be stated 

therein, in violation of section 6(b) of the Commodity Exchange Act (7 U.S.C. 

9); (4) is unfit to engage in the business of futures commission merchant, and 

that (5) the respondent corporation's application for registration as a futures 

commission merchant should be denied under the provisions of section 8a of the 

Commodity Exchange Act (7 U.S.C. 12a). 

The complainant states that due to the death of respondent Theodore W. Lord, 

Sr., the administrative officials of the Commodity Exchange Authority believe 

that this proceeding 
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should be terminated without action as to him and that the prompt entry of the 

proposed order as to respondent Professional Commodity Service, Inc., would 

constitute a satisfactory disposition of this case, serve the public interest 

and effectuate the purposes of the Act. The complainant recommends, therefore, 

that the stipulation be accepted and the proposed order be issued as to 

respondent Professional Commodity Service, Inc. It is concluded that the 

complainant's recommendation should be adopted. 

ORDER

1. Effective upon the thirtieth day after the date of this order, respondent 

Professional Commodity Service, Inc., is prohibited from trading on or subject 

to the rules of any contract market for a period of 1 year, and all contract 

markets shall refuse all trading privileges to the said respondent during this 

period. Such prohibition and refusal shall apply to all trading done and 

positions held directly or indirectly by said respondent, either for its own 

account or as the agent or representative of any other person or firm, and also 

to all trading done and positions held indirectly through persons or firms owned 

by the respondent. 

2. Effective upon the date of service of this order, respondent Professional 

Commodity Service, Inc., shall cease and desist from: 

(a) Willfully making any material false or misleading statement in any report 

or application filed under the Commodity Exchange Act. 

(b) Willfully omitting to state any material fact in connection with any such 

application or report. 

(c) Willfully causing, aiding, counseling, commanding or inducing any person, 

to engage in any act or practice from which the said respondent is directed to 

cease and desist by this order. 

3. The application of respondent Professional Commodity Service, Inc., for 

registration as futures commission merchant is denied. 

A copy of this Decision and Order shall be served on each of the parties and 

on each contract market. 

LOAD-DATE: June 9, 2008 
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