The New York Board of Trade (NYBOT) and the New York MercantileExchange (Nymex) have announced a settlement of the litigationbetween them relating to the suspension of a clearing member, Klein& Co. Futures, Inc., from NYBOT and its clearinghouse, the NewYork Clearing Corporation (NYCC).

Under the terms of the settlement, all remaining third-partycustomers of Klein & Co. will be reimbursed for funds ondeposit with the clearing member, which has now gone out ofbusiness.

“NYBOT and NYMEX have mutual interests in protecting theintegrity of our respective exchanges and the trading environmentfor the public and members who trade on both floors,” commentedMark D. Fichtel, president of NYBOT. “The dismissal of the lawsuitmeans that the 15 NYMEX members who were named plaintiffs in thelitigation can now receive payment for the value of their accounts— a process voluntarily initiated by NYBOT’s Board of Directors,immediately after Klein defaulted, with respect to theapproximately 300 other non-defaulting customers of Klein &Co.”

The announcement Tuesday marked the completion of an agreementannounced last May after Nymex and 15 of its members filed a classaction complaint against NYBOT, NYCC and Klein, claiming NYBOTimproperly used the funds of others to satisfy obligations of anunrelated Klein customer who failed to meet margin calls (see DailyGPI May 22).

©Copyright 2000 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press, Inc.