Page:United States Statutes at Large Volume 49 Part 1.djvu/1539

 149 4 Co t to n ; s imultaneous exe cutio n of buyin g and se llin g or ders for dif fer- ent principals. Provi so. Execu tion of, at pub- lic outcry. Report, recording, and clea ring. Additi onal u nlawful acts. "Wash sale", etc. "Privile ge", etc . Use of tran sacti on t o cause reporting, etc ., of untrue pr ice. Exchange of futures in c onnection with cash commodity transac- tio ns, etc. State laws not im- pai red. Fu tur es commission mer chants. Qualific ations, re- strictions, etc . Regis trati on. Treatment of proper- ty received to margin, etc., trades. Mo ney and other property belonging to c usto mer . Accounting, unau- thorized use, etc. Provisos. Deposit, withdrawal, etc. 74TH CONGRESS. SESS. II. CH. 545 . JUNE 15, 1936. "Nothin g in this section or in a ny other section of this Act shall be constru ed to pr event a futures commis sion me rchant o r floor broker who shall have in hand, simultaneously, buying and selling orders at the market for different principals for a like quantity of cotton for future delivery in the same month, from executing such buying and selling orders at the market price : Provided, That any such execu- tion shall take place on the floor of the exchange where such orders are to be executed at public outcry across the ring and shall be duly reporte d, recor ded, an d cleare d in th e same manner a s other orders executed on such exchange, "SEC. 4c. It shall be unlawful for any person to offer to enter into, enter i nto, or confirm the exe cution of, any transac tion in volving any commodity, which is or may be used for (1) hedging any trans- action in interstate commerce in such commodity or the products or byproducts thereof, or (2) determining the price basis of any such transact ion in intersta te comm erce in such co mmodity, or (3) delivering any such commodity sold, shipped, or received in inter- state commerce for the fulfillment thereof- "(A) if such transaction is, is of the character of, or is com- m only known to the trade a s, a `wash sale', `cross trade', or 'accom- modation trade', or is a fictitious sale ; "( B) if such transaction is, is of the character of, or is com- mo nly know n to th e trade as, a ` privileg e', `in demnity', 'bid' , `offer, 'put', `call', `advance guaranty', or `decline guaranty', or " (C) if such transaction is used to cause any price to be reported, registered, or recorded which is not a true and bona fide price . "Nothing in this section shall be construed to prevent the exchange of futures in connection with cash commodity transactions or of futures for cash commodities, or of transfer trades or office trades if made in accordance with board of trade rules applying to such trans actions and suc h rules shall n ot have been di sapprove d by th e Secretary of Agriculture. Nothing in this section or section 4b shall be construed to impair any State law applicable to any trans- action enumerated or described in such sections. "SEC . 4d . It shall be unlawful for any person to engage as futures commission merchant in soliciting orders or accepting orders for the purchase or sale of any commodity for future delivery, or involv- ing a ny contr acts of sale of any co mmodity for fut ure deli very, o n or subject to the rules of any contract market unless- "(1) such person shall have registered, under this Act, with the Secretary of Agriculture as such futures commission merchant a nd such registr ation s hall no t have e xpired nor been suspen ded nor revoked ; and "(2) such person shall, whether a member or nonmember of a contract market, treat and deal with all money, securities, and property received by such person to margin, guarantee, or secure the trades or contracts of any customer of such person, or accru- ing to such customer as the result of such trades or contracts, as belonging to such customer. Such money, securities, and property shall be separately accounted for and shall not be commingled with the funds of such commission merchant or be used to margin or guarantee the trades or contracts, or to secure or extend the credit, of any customer or person other than the one for whom the same are held : Provided, however, That such money, securi- ties, and property of the customers of such futures commission merchant may, for convenience, be commingled and deposited in the same account or accounts with any bank or trust company or with the clearing house organization of such contract market, and that such share thereof as in the normal course of business