[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 7USC6b]
TITLE 7--AGRICULTURE
CHAPTER 1--COMMODITY EXCHANGES
Sec. 6b. Fraud, false reporting, or deception prohibited
(a) Contracts designed to defraud or mislead; bucketing orders
It shall be unlawful (1) for any member of a registered entity, or
for any correspondent, agent, or employee of any member, in or in
connection with any order to make, or the making of, any contract of
sale of any commodity in interstate commerce, made, or to be made, on or
subject to the rules of any registered entity, for or on behalf of any
other person, or (2) for any person, in or in connection with any order
to make, or the making of, any contract of sale of any commodity for
future delivery made, or to be made, for or on behalf of any other
person if such contract for future delivery is or may be used for (A)
hedging any transaction in interstate commerce in such commodity or the
products or byproducts thereof, or (B) determining the price basis of
any transaction in interstate commerce in such commodity, or (C)
delivering any such commodity sold, shipped, or received in interstate
commerce for the fulfillment thereof--
(i) to cheat or defraud or attempt to cheat or defraud such
other person;
(ii) willfully to make or cause to be made to such other person
any false report or statement thereof, or willfully to enter or
cause to be entered for such person any false record thereof;
(iii) willfully to deceive or attempt to deceive such other
person by any means whatsoever in regard to any such order or
contract or the disposition or execution of any such order or
contract, or in regard to any act of agency performed with respect
to such order or contract for such person; or
(iv) to bucket such order, or to fill such order by offset
against the order or orders of any other person, or willfully and
knowingly and without the prior consent of such person to become the
buyer in respect to any selling order of such person, or become the
seller in respect to any buying order of such person.
(b) Buying and selling orders for commodity
Nothing in this section or in any other section of this chapter
shall be construed to prevent a futures commission merchant or floor
broker who shall have in hand, simultaneously, buying and selling orders
at the market for different principals for a like quantity of a
commodity for future delivery in the same month executing such buying
and selling orders at the market price: Provided, That any such
execution 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 reported, recorded, and cleared in the same manner as other orders
executed on such exchange: And provided further, That such transactions
shall be made in accordance with such rules and regulations as the
Commission may promulgate regarding the manner of the execution of such
transactions.
(c) Inapplicability to transactions on foreign exchanges
Nothing in this section shall apply to any activity that occurs on a
board of trade, exchange, or market, or clearinghouse for such board of
trade, exchange, or market, located outside the United States, or
territories or possessions of the United States, involving any contract
of sale of a commodity for future delivery that is made, or to be made,
on or subject to the rules of such board of trade, exchange, or market.
(Sept. 21, 1922, ch. 369, Sec. 4b, as added June 15, 1936, ch. 545,
Sec. 5, 49 Stat. 1493; amended Pub. L. 90-258, Sec. 5, Feb. 19, 1968, 82
Stat. 27; Pub. L. 93-463, title IV, Sec. 405, Oct. 23, 1974, 88 Stat.
1413; Pub. L. 99-641, title I, Sec. 101, Nov. 10, 1986, 100 Stat. 3557;
Pub. L. 102-546, title IV, Sec. 402(3), Oct. 28, 1992, 106 Stat. 3624;
Pub. L. 106-554, Sec. 1(a)(5) [title I, Sec. 123(a)(5)], Dec. 21, 2000,
114 Stat. 2763, 2763A-407.)
Amendments
2000--Subsec. (a)(1). Pub. L. 106-554 substituted ``registered
entity'' for ``contract market'' in two places.
1992--Pub. L. 102-546 designated first par. as subsec. (a),
redesignated cls. (a) to (c) as subpars. (A) to (C), respectively, and
subpars. (A) to (D) as cls. (i) to (iv), respectively, and designated
second and third undesignated pars. as subsecs. (b) and (c),
respectively.
1986--Pub. L. 99-641 struck out ``on or subject to the rules of any
contract market,'' after ``to be made'' in cl. (2) of first par. and
added concluding paragraph that this section not apply to activity on
board of trade, exchange, market, or clearinghouse located outside
United States involving contract of sale of commodity for future
delivery.
1974--Pub. L. 93-463 substituted ``a commodity'' for ``cotton'' in
provisions following subpar. (D) and inserted requirement that execution
of buying and selling orders for commodities held simultaneously by the
same merchant or broker be carried out in accordance with such rules and
regulations as the Commission may promulgate regarding the manner of the
execution of such transactions.
1968--Pub. L. 90-258 relocated cl. (1) designation in first par. to
follow ``unlawful'' rather than to precede ``any contract of sale'',
provided in such cl. (1) for orders to make or making of contracts of
sale ``made, or to be made on or subject to the rules of any contract
market, for or on behalf of any other person'' and in cl. (2) ``for any
person, in or in connection with any order to make, or the making of,''
any contract of sale of any commodity for future delivery for or on
behalf of any ``other'' person; and inserted ``other'' before ``person''
in subpar. (A) and in subpars. (B) and (C) where appearing for first
time, respectively.
Effective Date of 1974 Amendment
For effec
