For Release: March 31, 1999
CFTC FILES STATUTORY DISQUALIFICATION ACTION AGAINST
ATWOOD COMMODITIES, L.L.C. AND SIMULTANEOUSLY
ACCEPTS SETTLEMENT OFFER PLACING RESTRICTIONS
ON ATWOOD'S REGISTRATION
ACTION BASED ON CRIMINAL CONVICTION OF CONAGRA, INC., A PRINCIPAL OF
WASHINGTON - The Commodity Futures Trading Commission (CFTC) announced today that it has issued a Notice of Intent to Suspend or Restrict and Thereafter Revoke Registration (Notice) against Atwood Commodities, L.L.C. (Atwood) of Minneapolis, Minnesota, a registered futures commission merchant (FCM), and simultaneously accepted Atwood's offer of settlement, made without admitting or denying the allegations contained in the Notice, placing restrictions on its registration for a period of four years.
The CFTC's Notice alleges that ConAgra, Inc. (ConAgra) is a principal of Atwood because it owns fifty percent of Farmland-Atwood Company, L.L.C., which in turn owns one hundred percent of Atwood. The Notice further alleges that on June 25, 1997, Atwood's principal, ConAgra, pled guilty to and was convicted of wire fraud, a felony, in a criminal action brought by the United States Attorney for the Southern District of Indiana. The criminal action alleged that from 1989 through May 1992, ConAgra engaged in a scheme to defraud buyers of grain by misweighing and misgrading grain within ConAgra's Peavey Grain division.
In its Order, the CFTC found that Atwood's registration as a futures commission merchant is subject to revocation, suspension or restriction under section 8a(2)(H) of the Commodity Exchange Act (CEA), since the statutory disqualification of its principal, ConAgra, would be warranted under section 8a(2)(D) of the CEA.
Among other things, the CFTC's Order prohibits Atwood from ever employing any person implicated in any of the conduct or activities underlying the criminal information issued in the criminal action as to ConAgra and for a period of four years prohibits Atwood from employing any person with simultaneous management duties at ConAgra for the operation of the Peavey Grain division of ConAgra. The Order further requires Atwood for the next four years to give heightened review to the handling and processing of orders executed on behalf of ConAgra to ensure that they are handled and processed in accordance with the requirements of the CEA and CFTC regulations, to report any such problems to the CFTC, and to cooperate with any concurrent investigation by the CFTC. Finally, the Order requires Atwood to notify the CFTC of any criminal investigations or proceedings involving Atwood or its employees, and of any criminal proceedings in which ConAgra or any of its subsidiaries are named as defendants.