Ponzi Scheme: 04-10-09 William Perkins, St. George Utah, Guilty

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced that it obtained a federal court order against William D. Perkins of St. George, Utah and Tax Accounting Office (TAO), Perkins’ private bookkeeping service, for more than $2 million in an anti-fraud action brought by the CFTC in 2006. The CFTC action alleged that Perkins fraudulently solicited $3.4 million from investors in a commodity pool he operated under the name Universe Capital Appreciation LLC. (See CFTC Release 5240-06 October 5, 2006.)

The opinion and order were entered on March 25, 2009, by U.S. District Judge Robert B. Kugler of the District of New Jersey.

Specifically, the order requires Perkins to repay $1.6 million to investors and a civil monetary penalty of $354,462, and prohibits Perkins from engaging in any business activities related to commodity futures or options trading. The court also ordered relief defendant TAO to repay $76,000 of investor money in which TAO had no legitimate interest.

In the opinion, Judge Kugler found that Perkins was reckless to solicit funds for his commodity pool without making a reasonable inquiry into the validity of representations that third parties made regarding the performance of the “superfund”, especially where Perkins had personal experience in three previous failed high yield investment schemes with one of the parties in which they had lost over $2 million of participant funds.

The CFTC complaint alleged that Perkins touted Universe Capital Appreciation LLC as a way for investors with less than $100,000 to participate in a so-called “superfund” that Perkins claimed was making “astonishing” profits of approximately 100 percent annually trading financial futures contracts. In fact, the CFTC complaint alleged that the “superfund” was itself a massive fraud that was the subject of other CFTC actions resulting in over $45 million in judgments. (See CFTC Press Releases 5447-08 February 7, 2008 and 5357-07, July 23, 2007.)

The following Division of Enforcement staff members are responsible for this case: Elizabeth M. Streit, Joy McCormack, Venice Bickham, Scott R. Williamson, Rosemary Hollinger, and Richard Wagner.

Fraud: 04-07-09 Commodity Pool, Blayne Davis, Damien Bromfield & Donovan Davis

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it charged Donovan Davis, Jr. (D. Davis) of Palm Bay, Florida, Blayne Davis (B. Davis), of Naples, Florida, Damien Bromfield, of Ocoee, Florida, Capital Blu Management, LLC (Capital Blu) of Melbourne, Florida, and DD International Holdings, LLC (DDIH) of Palm Bay, Florida with operating a fraudulent commodity scheme involving about 100 investors and approximately $17 million solicited purportedly to invest in foreign currency (forex) futures and options.

The complaint was filed under seal on March 23, 2009, in the U.S. District Court for the Middle District of Florida. On the same day, the Honorable John Antoon II entered an order freezing defendants’ assets and preserving books and records.

As alleged, defendants told prospective investors that their funds would be pooled in the CBM FX Fund, LP (FX Fund), a commodity pool established by Capital Blu. Rather than pool investor funds, the defendants split the funds into trading of both off-exchange and on-exchange forex futures and off-exchange forex options. In addition, the defendants allegedly deposited millions of dollars into multiple Capital Blu bank accounts, where funds were commingled and misappropriated for personal use, including luxury automobiles, private jet charters and, a two-night $40,000 spree at a “gentlemen’s club.”

Ultimately, as alleged, of the $17 million solicited, $7 million was lost in trading, and millions of dollars remain unaccounted for.

To hide their fraud, the complaint alleges, D. Davis, B. Davis, and Bromfield provided investors with phony account statements misrepresenting the earnings in their accounts by showing consistent monthly profits as high as 7 percent for 12 straight months (September 2007 through August 2008). In fact, as alleged, defendants’ actual trading resulted in net losses every month.

Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC Named as Relief Defendants

According to the complaint, B. Davis withdrew more than $135,000 of the pool participants’ funds and deposited those funds into accounts held in the name of one or more of Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC, all of whom have been named in the CFTC complaint as relief defendants. None of these entities provided legitimate services to the FX Fund and have no legitimate entitlement to the funds they received.

In its continuing litigation, the CFTC seeks restitution, disgorgement of ill-gotten gains, civil monetary penalties, and permanent injunctions against further trading.

The CFTC’s Division of Enforcement would like to thank the National Futures Association and the State of Florida Office of Financial Regulation in Orlando, Florida for their assistance.

The following Division of Enforcement staff members are responsible for this case: Daniel Jordan, Kenneth McCracken, Michael Loconte, and Rick Glaser.

Ponzi Scheme: 02-27-09 Daren Palmer of Trigon Group, Charged

Washington, D.C. – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it charged Daren L. Palmer of Idaho Falls, Idaho, with operating a Ponzi scheme involving approximately $40 million in connection with the unregistered Trigon Group, Inc. commodity futures pool.

The CFTC’s complaint, filed on February 26, 2009, charges Palmer with solicitation fraud and misappropriation of pool funds for personal use and for use in running a Ponzi scheme. In addition, Palmer is charged with sending customers false account statements and failing to register with the CFTC as a commodity pool operator. In conjunction with the CFTC’s filing, the Honorable Edward J. Lodge of the United States District Court for the District of Idaho issued a restraining order freezing defendants’ assets and preserving records. Judge Lodge set a hearing on the CFTC’s motion for preliminary injunction on April 23^rd at 9:30 a.m.

The CFTC complaint alleges that, from at least September 2000 through present, Palmer fraudulently solicited approximately $40 million from dozens of individuals and entities to participate in a commodity futures pool to trade commodity futures or options on commodity futures contracts. In soliciting prospective and existing participants, Palmer allegedly claimed that he was a successful commodity futures trader, that his pool had a successful track record, and that the pool achieves positive returns of as much as 7 percent monthly and 20 percent annually.

“This is another unfortunate example of the maxim, ‘If it appears too good to be true, it probably is.’ Investors must carefully scrutinize any investment opportunity that claims to be consistently profitable. This case shows that the CFTC, working in tandem with other federal authorities, continues to pursue corrupt commodity professionals who treat investor’s hard earned money as their own,” according to CFTC Acting Director of Enforcement Stephen J. Obie.

The complaint alleges that, in reality, Palmer was neither successfully trading nor making an effort to do so. As alleged, despite taking in at least $40 million in participant funds since September 2000, Palmer only placed $4.5 million in his trading accounts. Moreover, Palmer admitted in sworn testimony that he used participants’ funds to pay principal and purported profitable returns to existing pool participants in a manner typical of a Ponzi scheme. He also admitted that he misappropriated pool funds for his personal use for the construction of a new home, to pay credit card bills, and purchase snowmobiles. From the outset, Palmer also paid himself purported fees based on the falsified earnings and increased value of the pool. Contrary to Palmer’s claim that he would be compensated only after pool participants earned a certain rate of return, during the course of Trigon’s operation, Palmer compensated himself with monthly fees ranging from $25,000 to $35,000 per month, regardless of the profitability of Trigon’s futures trading.

According to complaint, Palmer concealed the fraud by failing to register with the CFTC and providing fabricated quarterly account statements to pool participants, which showed consistently profitable pool returns. The account statements reported that as late as 2008, the pool had increased in value to over $65 million.

Efforts are ongoing to account for and locate pool participant funds.

In its continuing litigation, the CFTC seeks restitution, disgorgement of ill-gotten gains, civil monetary penalties, and permanent injunctions against further violations of the federal commodities laws and against further trading.

The CFTC appreciates the assistance of the Idaho Department of Finance and the Securities and Exchange Commission (SEC). The SEC filed a related action against Palmer and Trigon.

The following CFTC Division of Enforcement staff members are responsible for this case: John W. Dunfee, Mary Kaminski, Alison Wilson, Paul G. Hayeck, and Joan Manley.

Commodity Options Scam: 02-25-09, Michele LaBruce & Zurich Futures & Options

Washington, D.C. — The Commodity Futures Trading Commission (CFTC) announced today the filing of an enforcement action against Zurich Futures & Options, Inc. (Zurich) and Michele LaBruce, both of Hollywood, Florida, charging them with fraudulent solicitation of customers, using false claims of CFTC registration and membership with the National Futures Association (NFA), and with operating as an unregistered Introducing Broker (IB).

The Fraud Targeted Canadian and Other Non-U.S. Citizens

The CFTC complaint, filed in the U.S. District Court, Southern District of Florida on February 24, 2009, alleges that, from approximately April 2006 through approximately March 2007, defendants fraudulently solicited approximately $1.45 million from at least 60 customers who opened trading accounts to trade commodity options. As alleged, defendants targeted Canadian and other non-U.S. citizens as customers and falsely claimed that Zurich was a member of the NFA and registered with the CFTC as an IB. Through the Zurich website, solicitation materials, and the activities of their brokers, defendants created a false impression that Zurich was a successful and well-established international IB with an experienced investment team and offices in Zurich, Switzerland and Toronto, Canada.

In fact, as alleged in the CTFC complaint, Zurich was nothing more than a sham operation that operated out of the Hollywood, Florida area. Zurich rented mail drop offices in Switzerland and Canada through which the defendants re-routed customer calls to Southern Florida and funneled mailings of solicitation materials and account opening documents. According to the CFTC complaint, in slightly less than one year of operation, Zurich collected more than $1.3 million in commissions and fees, while its customers lost almost all their money trading with Zurich. Zurich then abruptly shut down its operations with no notice to its customers and provided no way for those customers to get in touch with Zurich or its brokers.

The CFTC complaint charges LaBruce directly with fraud and with liability for Zurich’s fraud. In addition, the CFTC alleges that by soliciting customers to open trading accounts at an FCM to trade on-exchange commodity options, Zurich was required to be registered as an IB and LaBruce was required to be registered as an Associated Person of Zurich.

LaBruce is the wife of Adam Leon. In September 2006, the CFTC obtained a judgment against Leon as part of a case brought against Presidential FX for fraudulent solicitation of customers in connection with foreign currency option contracts. Under that judgment, Leon was ordered to pay $1.5 million in restitution and a $1 million civil monetary penalty, and was permanently enjoined from engaging in any commodity-related activity. (See CFTC News Release 5234-06, September 27, 2006.)

The CFTC gratefully acknowledges the assistance of the Belize Financial Intelligence Unit, the Ontario Securities Commission, the Swiss Federal Market Supervisory Authority, and the Israel Securities Authority in investigating this matter.

The following CFTC Division of Enforcement staff members are responsible for this case: Alan I. Edelman, James H. Holl, III, Kara Mucha, Michelle Bougas, Gretchen L. Lowe, and Vincent McGonagle.

Investment Scheme: 02-25-09 Stephen Walsh, Paul Greenwood, Only $1.3B

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today charged Stephen Walsh of Sands Point, New York, and Paul Greenwood of North Salem, New York, with misappropriating at least $553 million from commodity pool participants in connection with entities they owned and controlled, such as Westridge Capital Management, Inc., WG Trading Investors, LP, and WGIA, LLC. The defendants’ alleged misappropriation was uncovered during an audit by the National Futures Association.

CFTC is Seeking a Court Order Freezing Assets and Preserving Records; Additional Criminal and Civil Actions Filed

The CFTC’s complaint charges Walsh and Greenwood with futures fraud and misappropriation of pool funds. In conjunction with the CFTC’s filing of the complaint today in the United States District Court for the Southern District of New York, the CFTC is seeking a statutory restraining order freezing defendants’ assets and preserving records.

At the same time, the office of the United States Attorney for the Southern District of New York filed a criminal complaint against Walsh and Greenwood, and the Securities and Exchange Commission filed a civil action against Walsh, Greenwood, and others.

According to CFTC Acting Director of Enforcement Stephen J. Obie, “The coordinated efforts of multiple federal regulators resulted in uncovering and ending this egregious fraud. Defendants treated investor money– some of which came from a public pension fund– as their own piggy bank to lavish themselves with expensive gifts. The public can rest assured that their nation’s commodity futures regulator is pursuing every avenue to locate and eliminate crooked commodity professionals.”

The CFTC complaint alleges that, from at least 1996 to the present, Walsh and Greenwood fraudulently solicited approximately $1.3 billion from individuals and entities through Westridge Capital Management, WG Trading Investors, LP, and other entities. The complaint charges that the defendants defrauded victims by falsely depicting that all pool participants’ funds would be employed in a single investment strategy that consisted of index arbitrage. However, pool participants’ funds were transferred to another entity from which Walsh and Greenwood siphoned funds, according to the complaint.

According to the complaint, to cover-up their misappropriation of pool participants’ funds, Greenwood and Walsh manufactured promissory notes to present the appearance that pool participants’ funds had been loaned to them.

Walsh and Greenwood allegedly misappropriated approximately $553 million in pool participants’ funds. More than $160 million was used for Walsh and Greenwood’s personal expenses, including purchasing rare books, horses, Steiff teddy bears for as much as $80,000, and a $3 million residence for Walsh’s ex-wife.

Efforts are ongoing to account for and locate pool participant funds.

Five Relief Defendants Also Named

In addition, Westridge Capital Management Enhancement Funds Inc., WG Trading Company LP, WGI LLC, K&L Investments, and Janet Walsh are named in the complaint as relief defendants because they received funds as a result of defendants’ fraudulent conduct and have no legitimate entitlement to those funds.

In the continuing litigation, the CFTC seeks restitution, disgorgement, civil monetary penalties, and permanent injunctions against further violations of the federal commodities laws and against further trading.

The CFTC greatly appreciates the assistance of the National Futures Association, the office of the United States Attorney for the Southern District of New York, the Federal Bureau of Investigation, and the Securities and Exchange Commission.

The following CFTC Division of Enforcement staff members are responsible for this matter: Patricia Gomersall, JonMarc Buffa, Joseph Rosenberg, Peter Haas, Paul Hayeck, and Joan Manley.

Last Updated: February 25, 2009

Fraud: 02-19-09 Frank Anthony DeDantis III, Guilty

Washington, DC — The U.S. Commodity Futures Trading Commission (CFTC) commends the U.S. Attorney for the Southern District of Florida for the successful prosecution of Frank Anthony DeSantis III (DeSantis), of Stuart, Florida. DeSantis pled guilty to conspiracy to commit mail and wire fraud, and conspiracy to defraud the Internal Revenue Service. DeSantis was sentenced to 108 months in prison and was ordered to pay over $2 million in tax penalties.

As part of his guilty plea, DeSantis admitted to his participation in a conspiracy to commit mail and wire fraud while operating and having a financial interest in several commodity investment and telemarketing rooms throughout South Florida. To execute his scheme, DeSantis made and caused others to make misrepresentations of material facts to potential customers, in order to convince them to invest in foreign currency (forex) options. In addition, DeSantis and others deliberately failed to tell customers that more than 95 percent of customers lost money and that DeSantis had previously been barred by the CFTC from acting as a commodities broker.

Criminal Prosecution Follows the CFTC’s 2006 Civil Complaint

On September 9, 2008, the CFTC obtained an order of permanent injunction resolving all CFTC charges against DeSantis, in CFTC v. Doreen Valko, et al., 06 CV 60001 (S.D.Fla.). In that action, filed in 2006, the CFTC alleged that DeSantis used customers’ money to purchase luxury homes, boats, and cars, among other things. Ultimately, the Honorable William P. Dimitrouleas ordered DeSantis to pay more than $8 million in restitution and penalties for committing fraud and misappropriation in connection with his operation of International Investments Holdings Corporation (IIHC). The order also permanently prohibits DeSantis from engaging in any business activities related to commodity futures and options trading. (See CFTC News Releases 5544-08, September 16, 2008 and 5204-06, July 24, 2006.)

FX Ponzi Scheme: 02-19-09 Marvin Cooper, Defrauding Deaf Community

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it charged Marvin Cooper and his company Billion Coupons, Inc. (BCI), both of Honolulu, Hawaii, with operating a Ponzi scheme that involved more than 125 customers — all of whom are Deaf — in connection with commodity futures trading and foreign currency futures (forex) trading.

The CFTC alleges that since at least September 2007, Cooper and BCI solicited approximately $4.4 million from more than 125 Deaf American and Japanese individuals for the sole purported purpose of trading forex. Also, according to the complaint, while Cooper and BCI opened both forex and futures accounts with approximately $1.7 million of customer money, Cooper misappropriated more than $1.4 million of customer funds for personal use. Cooper allegedly used the misappropriated funds to purchase computer and electronic equipment, flying lessons, and a $1 million home. He also allegedly returned approximately $1.6 million to customers as purported “profits” and as commissions to employees and agents.

“This case is a clear example of affinity fraud: Cooper preyed upon the Deaf community to leverage and exploit the inherent trust within so that his scheme would prosper. The CFTC urges the public to be cautious with their investments even when opportunities are presented by those with whom they have an association,” said CFTC Acting Director of Enforcement Stephen J. Obie.

Cooper and BCI allegedly lured in customers with promises of 15 to 25 percent monthly returns, depending on the amount and size of the customer’s investment, while representing that the investment would be low risk and that the promised return was produced by their successful trading. Cooper and BCI, however, were running a Ponzi scheme since the purported “profits” paid to customers came from existing customers’ original principal and/or from money invested by subsequent customers.

Finally, the complaint alleges that to conceal and perpetuate their fraud, Cooper and BCI provided customers with false account statements representing that their accounts were increasing by as much as 25 percent, when, in fact, the accounts were collectively losing money every month.

Court Orders Freeze of Assets and Appoints Temporary Receiver

On February 18, 2009, the Honorable J. Michael Seabright of the United States District Court of Hawaii granted the CFTC’s request for emergency action by, among other things, freezing Cooper’s and BCI’s assets, granting immediate access to Cooper’s and BCI’s documents and appointing Barry Fisher as temporary receiver. Judge Seabright ordered Cooper and BCI to appear in court on March 2, 2009, at 9 a.m. for a preliminary injunction hearing. In the continuing litigation, the CFTC seeks restitution, disgorgement, civil monetary penalties, and permanent injunctions against further violations of the federal commodities laws and against further trading.

The CFTC requests that all victims of Cooper’s and BCI’s actions contact the temporary receiver at (310) 557-1077.

The CFTC appreciates the assistance of the Securities and Exchange Commission (SEC). The SEC simultaneously filed a related emergency action against Cooper and BCI. The CFTC also wishes to thank the State of Hawaii, Department of Commerce and Consumer Affairs, Office of the Commissioner of Securities.

The following CFTC Division of Enforcement staff members are responsible for this case: Kenneth W. McCracken, Elizabeth Davis, Michael Loconte, Rick Glaser, and Richard Wagner.

Derivatives: 02-11-09 HR 977 Markets Transparency and Accountability Act of 2009

House Agriculture Committee Passes Legislation to Bring Transparency and Accountability to Derivatives Markets

H.R. 977 Builds on Last Year’s House-Passed Bill to Strengthen Oversight and Prevent Manipulation of Futures Markets

WASHINGTON – Today, the House Agriculture Committee approved legislation to increase the transparency and strengthen oversight of futures, options and over-the-counter (OTC) markets. By voice vote, the Committee approved the Derivatives Markets Transparency and Accountability Act of 2009 as amended, a bill sponsored by Committee Chairman Collin C. Peterson of Minnesota.

The legislation, H.R. 977, will bring greater transparency and oversight to futures and OTC derivatives markets. It toughens position limits on futures contracts for physically-deliverable commodities as a way to prevent potential price distortions caused by excessive speculative trading. The bill also imposes a clearing requirement on OTC derivatives contracts and empowers the Commodity Futures Trading Commission (CFTC) with the ability to suspend trading in naked credit default swaps under certain
circumstances.

“This bill broadens and improves on last year’s bipartisan derivatives legislation that passed the House by a wide margin,” Chairman Peterson said. “The urgency to fix the problems in regulated and unregulated futures markets magnified by the credit crisis and the collapse of some of America’s largest financial institutions: entities that were heavily involved in the trading of off-exchange credit derivatives like swaps contracts. Their failures have put the American taxpayer on the hook, so just sitting back and doing
nothing is not an option. Congress should act quickly and pass a bill that will bring much-needed transparency to derivatives markets.”

H.R. 977 contains provisions similar to a bipartisan bill to strengthen the oversight of futures markets from the 110th Congress. That bill, introduced by Chairman Peterson, passed the House last September by a vote of 283-133. In addition, the Committee held three hearings on credit derivatives late last year, along with two hearings last week with industry and stakeholder groups to examine derivatives legislation.

Provisions included in the Derivatives Markets Transparency and Accountability Act would:

a.. Require all prospective over-the-counter transactions to be settled and cleared through a CFTC-regulated designated clearing organization, unless exempted by the CFTC in accordance with specified criteria. In some cases, the clearing requirement can be met through a Securities and Exchange Commission (SEC) regulated clearing agency or a properly regulated foreign clearinghouse.

b.. Give CFTC the authority, with the President’s consent, to suspend naked credit default swap trading whenever a SEC shortselling suspension order is in effect.

c.. Close the so-called “London Loophole” by requiring foreign boards of trade to share trading data and adopt speculative position limits on contracts that trade U.S. commodities similar to U.S.-regulated exchanges.

d.. Require CFTC to set trading limits for physically-deliverable commodities, in order to prevent excessive speculation.

e.. Empower the CFTC to criminally prosecute people who violate commodities legislation.

f.. Limit eligibility for hedge exemptions to bona-fide hedgers.

g.. Improve transparency by requiring that CFTC disaggregate and separately report the trading activity of index funds and swapdealers in agriculture and energy markets.

h.. Call for new, full-time CFTC employees to enforce manipulation and prevent fraud.

i.. Authorize CFTC to take corrective action if it finds disruption in over-the-counter markets for energy and gas.

During today’s business meeting the Committee considered and adopted several amendments to the underlying bill. The Committee approved:

a.. A manager’s amendment by Chairman Peterson, by voice vote, containing technical and clarifying corrections, and changes regarding position limits and CFTC authority to suspend credit default swaps trading.

b.. An amendment by Representative Larry Kissell (D-NC) regarding the composition of governing boards of publicly traded exchanges.

c.. An amendment by Representative Earl Pomeroy (D-ND) requiring that CFTC hold hearings twice each year regarding appropriate levels of speculative position limits.

d.. An amendment by Representative Leonard Boswell (D-IA) regarding alternatives to clearing through derivatives clearing organizations.

Congressional oversight of commodity futures trading is under the jurisdiction of the House Agriculture Committee. Previous Committee action on derivatives legislation from the current Congress as well as previous sessions of Congress, including hearing opening statements and bill summaries can be found on the House Agriculture Committee website at http://agriculture.house.gov/inside/legislation.html.

Ponzi Scheme: 02-10-09 Mark Trimble, Assets Frozen

For Release: February 10, 2009

Washington, DC – The Commodity Futures Trading Commission (CFTC) announced that today it filed an enforcement action against Mark S. Trimble, of Edmond, Oklahoma, and his company, Phidippides Capital Management LLC (PCM), with offices in Oklahoma City. Trimble, who controlled Phidippides, also managed a private hedge fund named Phidippides Capital LP, which the CFTC’s complaint alleges was a Ponzi scheme.

CFTC Seeks Court Order Freezing Defendants’ Assets

In conjunction with the filing of the complaint today in the U.S. District Court for the Western District of Oklahoma, the CFTC is seeking a statutory restraining order freezing defendants’ assets and preserving records. Trimble has consented to the entry of an asset freeze order.

The CFTC’s complaint alleges that, from at least 2005 to the present, Trimble and PCM operated a $34 million hedge fund with approximately 60 investors and traded partly in the name of Phidippides Capital, a Delaware company incorporated by Trimble. Since at least October 2007, Trimble and PCM allegedly issued false account statements, failed to disclose the fund’s actual multi-million trading losses, and operated the fund as a Ponzi scheme, paying participant redemptions based on the fund’s fabricated profitability. Additionally, defendants allegedly received over $1 million in management fees based on false reports of trading profits.

Trimble Used Email to Notify Investors that He Had Not Been “Honest” About the Fund’s Trading Results

According to the complaint, Trimble’s activities were exposed in late January 2009, after Trimble provided the Federal Bureau of Investigation a fictitious 2008 year-end trading account showing millions of dollars in trading profits that did not square with actual trading statements issued by Trimble’s brokerage firm that disclosed millions of dollars in trading losses. Trimble subsequently stated in an email sent to his brokerage firm, and addressed to “Family, Friends, and Clients,” that he had not been “honest” about the hedge fund’s trading results, explaining: “The reason our balances are off is because I could not look myself in the mirror and face all of you and notify you that in the last quarter of 2008 we lost all the profits for the year and then some.”

Stephen J. Obie, CFTC Acting Director of the Division of Enforcement commented: “Through the swift action of CFTC staff, millions of dollars have been frozen, which ultimately we will seek to return to the victims Trimble deceived by his scheme. The CFTC continues to zealously prosecute these lecherous schemes, so that as many assets can be preserved as possible as we fulfill our vital mission to protect customers from fraud and abuse.”

The CFTC’s complaint seeks civil monetary penalties, disgorgement of ill-gotten gains, restitution to defrauded customers, and injunctive relief, among other sanctions.

The CFTC appreciates the assistance of the Securities and Exchange Commission and the Financial Crimes Enforcement Network.

The following CFTC Division of Enforcement staff members are responsible for this case: Rosemary Hollinger, Scott Williamson, Richard Wagner, and Ken Hampton. CFTC Auditors Thomas J. Bloom, Shauna Wright-Regas, and Lauren Corn also are working on this matter.

Commodity Pool Scam: 02-06-09 Albert E. Parish/Parish Economics

Washington, DC — The U.S. Commodity Futures Trading Commission (CFTC) announced today that the Honorable David C. Norton of the U.S. District Court for the District of South Carolina entered an order settling charges alleging that Albert E. Parish and Parish Economics LLC, both of Charleston, South Carolina, lied to customers and misappropriated millions of dollars in customer funds (see CFTC Press Release 5320-07, April 19, 2007).

According to the order entered on February 2, 2009, between 1986 and March 2007, Parish and Parish Economics fraudulently solicited approximately $40 million in investments for their commodity futures pool. Parish and Parish Economics misrepresented to pool participants that funds would be invested in commodity futures when, in reality, Parish misappropriated the vast majority of funds for his personal use. Parish and Parish Economics also provided false futures account statements to pool participants and failed to provide required pool disclosure documents.

The order permanently bars Parish and Parish Economics from further violating certain provisions of the Commodity Exchange Act and the CFTC’s regulations and from engaging in any commodity-related activity. Parish is currently serving a sentence of more than 24 years in federal prison for related criminal violations. In lieu of an award of restitution and civil monetary penalties, the order recognizes that Parish will be subject to a criminal judgment restitution obligation in excess of $40 million.

The CFTC would like to thank James A. Rue of the Securities and Exchange Commission and John H. Douglas of the U.S. Attorney’s Office for the District of South Carolina for their assistance in this matter.

The following CFTC Division of Enforcement staff members are responsible for this case: Jo Mettenburg, Jeff Le Riche, Charles Marvine, Donald Nash, Rick Glaser, and Richard Wagner.