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broker as a member of a brokerage association consisting of
petitioner, Richard Lowrance, and Patrick Maloney. Petitioner
initially was employed as an assistant to Mr. Lowrance during
1982 and, beginning during 1984 and continuing at least through
the end of 1989, worked as an order filler for Mr. Lowrance.
Petitioner paid Mr. Lowrance a portion of the commissions
petitioner earned.
Petitioner executed orders as a floor broker in a trading
pit at the CME. Customers would signal an order to a clerk, who
would bring it to petitioner, and petitioner would attempt to
execute it as quickly as possible while obtaining the best price.
Petitioner was responsible for the restitution of any money lost
by reason of errors made in filling a customer's order, which
errors could involve sums from $25,000 to over $100,000. During
busy times, petitioner could have 50 to 100 orders of various
types to be executed. Petitioner might make 200 trades in 1 day.
Competition for customers' orders was keen; a broker could lose
customers for repeated failures to fill orders on the terms they
specified and could attract customers by claiming the ability to
provide the best service available. As many as 300 or 400 others
also worked in the pit, and petitioner traded with persons all
over the pit, but it was easier to trade with persons near him.
Petitioner and the other members of his brokerage association
stood together in the pit, and it was therefore easy for them to
trade with one another. Each of petitioner's trades usually
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Last modified: May 25, 2011