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COMMODITY INVESTMENT GROUP
CASE OUTCOME: • FINE $7000000
• MAY NOT APPLY TO REGISTER
• MAKE RESTITUTION TO CUSTMERS
• JOINT OWED
• TRADING PROHIBITION
• OTHER (SEE NARRATIVE)
• PERMANENT INJUNCTION
• ACCESS BOOKS
• PROTECT BOOKS
• FREEZE ASSETS
• PRELIMINARY INJUNCTION
NFA ID:
0307484
Overview:
For Release: June 23, 2005 U.S. COMMODITY FUTURES TRADING COMMISSION CHARGES FLORIDA FIRM COMMODITY INVESTMENT GROUP AND ITS PRINCIPALS WITH FRAUD RESULTING IN OVER $9 MILLION IN LOSSES TO CUSTOMERS CFTC Alleges That Linda and Michael Kuhney Fraudulently Solicited Customers To Trade Commodity Options Contracts WASHINGTON D.C. – The United States Commodity Futures Trading Commission (CFTC) announced today the filing of an enforcement action in the U.S. District Court for the Southern District of New York against Commodity Investment Group (CIG) of Ft. Lauderdale, Florida, and Linda and Michael Kuhney, both of Coral Springs, Florida, alleging fraud in the solicitation to trade commodity options. The matter has been assigned to the Honorable Harold Baer, Jr., United States District Judge. Specifically, the CFTC complaint alleges that -- since January 2001 -- CIG, through its employees, knowingly misrepresented and failed to disclose material facts to prospective and existing customers concerning commodity options trading, including the likelihood of realizing large profits, the risk of loss, and the fact that nearly all of CIG’s customers lost money trading commodity options. The complaint further charges that CIG customers lost at least $9 million. Linda and Michael Kuhney were controlling persons of CIG and, therefore, were responsible for CIG’s actions, and Michael Kuhney aided and abetted CIG’s fraudulent solicitations, the complaint alleges. The complaint also alleges that, pursuant to their signed agreements, National Commodities Corporation Inc. was CIG's guarantor from January 2001 through June 2004, and International Clearing Corporation LLC has been CIG’s guarantor since June 2004, and thus they are jointly and severally liable for all of CIG’s violations. In its complaint and ongoing litigation, the CFTC is seeking preliminary and permanent injunctions, repayment to defrauded customers, the return of ill-gotten gains, and monetary penalties for violations of the Commodity Exchange Act. The CFTC thanks the National Futures Association for its assistance in this matter. The following CFTC Division of Enforcement staff members are responsible for this case: Eliud Ramirez Jr., W. Derek Shakabpa, Manal Sultan, William Tylinski, Lenel Hickson, Stephen J. Obie, and Richard Wagner.
Source: National Futures Association
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