CHICAGO -- The Chicago Board of Trade said yesterday that it had found no evidence of wrongdoing in the pricing of the index underlying its municipal bond futures contract, concluding a recent investigation.

In a statement, the futures exchange said it has "uncovered no irregularities in the pricing" of the Bond Buyer municipal bond index on which the futures contract is based.

An exchange spokesperson declined to elaborate on the statement.

The Board of Trade launched the investigation after receiving complaints that Goldman, Sachs & Co. was manipulating bond prices in the index.

"We sincerely appreciate the Chicago Board of Trade's prompt and thorough review which approved our procedures and eliminated any doubt about the correctness of our actions," a spokesman for Goldman said in a statement yesterday.

The complaints, which originated among several institutional investors, related to prices that Goldman provided to the six interdealer brokers responsible for pricing the index.

The complaints charged that Goldman was quoting to the brokers prices on bonds in the index that it later refused to honor when investors called seeking to buy or sell bonds at the quoted prices.

Goldman's prices for the 40 bonds in the index were contained on faxes that the firm began sending last month to the brokers twice a day. The price list, for both buying and selling the bonds, contained a disclaimer that the prices were subject to market conditions.

When news of the investigation surfaced last week, a spokesman for Goldman said the firm did "everything properly and stands by its quotes." Executives at the six firms that price the index also denied any manipulation had taken place.

Goldman officials said they would continue disseminating bond prices to the brokers. "We will continue to supply time-sensitive municipal bond quotations representing actual bids and offers to transact business with our clients and cash brokers," the firm said in its statement.

Disgruntled market participants whose complaints had prompted the investigation found little solace in the Board of Trade's findings. Some said the board's verdict on Goldman's actions might encourage others to try and influence the index.

The index, which was created in 1983 by the Board of Trade and the Bond Buyer, is based on price quotations provided by six dealer-to-dealer brokers for 40 actively traded municipal bonds. The index is calculated by dropping the high and low broker quotes for the bonds and averaging the remainder. That price is then divided by a conversion factor to produce an average converted price, which is the price that particular bond would have if it had a standard 8% coupon. The 40 prices in turn are averaged and multiplied by a coefficient to produce a final index price.

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