Less than two years after federal 'commod' squads obtained indictments against over 40 traders at the Windy City's two principal futures exchanges, volume remains as high as ever. Even so, Greising (a Business Week correspondent) and Morse (a reporter for Knight-Ridder Financial News) leave little doubt in this savvy, if discontinuous, overview that there were—and are—scams and double-dealing aplenty in the pits of the Chicago Board of Trade and Mercantile Exchange. The authors offer an authoritative account of the FBI investigation that sent four undercover agents into the trading rings to collect evidence of illegal practices. In addition to an episodic briefing on the sting from its 1987 inception through the first trial verdicts, Greising and Morse provide institutional histories of the essentially self-regulated CBT and Merc. The futures exchanges furnish the global economy a valuable price- discovery mechanism, but, run as old-boy clubs, they apparently also give floor brokers a license to steal from hedgers and speculators alike. The authors make a generally good job of explaining how venal traders defraud clients as well as the IRS. They also probe the political alliances and payoffs that ensure an anything-goes trading environment, and they don't spare federal prosecutors who inflated the significance of nickel-and-dime cases. The impact of their charges and reform proposals, though, is blunted by a fractured format that arrests the narrative flow to no discernible purpose at critical junctures. Also, the story's a long way from over. While the Chicago office of the US Attorney General can claim upwards of 30 scalps (via plea bargains and convictions), more than a dozen of the accused have been acquitted or given an interim pass by juries that could not reach verdicts. A knowledgeable, albeit less than cohesive, progress report on a consequential scandal.
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