Release: 4341-99 (CFTC Docket No. 96 - 4)

For Release: November 22, 1999


Settlement Agreement Revokes Whealan's Registration, Prohibits Him From Trading For Five Years, And Imposes A $125,000 Civil Monetary Penalty, Among Other Sanctions

WASHINGTON – The Commodity Futures Trading Commission (CFTC) announced today the issuance of an order accepting an offer of settlement from Emmett J. Whealan, a registered floor broker on the Chicago Mercantile Exchange (CME), in connection with a five-count administrative complaint alleging trade practice fraud filed by the CFTC against Whealan and two other floor brokers on April 18, 1996 (see CFTC News Release #3905-96, April 18, 1996).

The CFTC order, filed on November 18, 1999, finds that while trading live cattle futures contracts on the CME primarily for his own account, Whealan engaged in at least 27 instances of noncompetitive trading, some of which involved customer orders and by such noncompetitive trading, facilitated another floor broker's fraud. According to the order, between November 1, 1991 through June 30, 1993, Whealan aided and abetted another floor broker's cheating and defrauding of customers by entering into noncompetitive trades to accommodate the floor broker's indirect bucketing of customer orders and indirect filling of customer orders by offset in violation of sections 4b(a)(i), 4b(a)(iv) and 4c(a)(A) of the Commodity Exchange Act (CEA), and CFTC regulation 1.38(a). The order also finds that Whealan violated the recordkeeping requirements of CFTC regulation 1.35(d).

Whealan, without admitting or denying the CFTC's allegations, consented to the entry of an order finding that he violated all sections of the CEA and CFTC regulations as charged in the complaint and directing him to cease and desist from further violations; ordering him to pay a $125,000 civil monetary penalty; prohibiting him from trading for five years; and revoking his registration with the CFTC.

Whealan also agreed never to apply for CFTC registration in any capacity and never to engage in any activity that would require such registration, or act as an agent or officer of any person registered or required to be registered with the CFTC. Finally, Whealan agreed to cooperate with the CFTC's Division of Enforcement in its continuing litigation against the remaining respondents.

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