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CRESTWOOD CAPITAL MANAGEMENT, INC
CASE OUTCOME: EXPELLED FROM MEMBERSHIP
NFA ID:
0000551
Complaint:
ON JUNE 16, 1988, THE CENTRAL REGIONAL BUSINESS CONDUCT COMMITTEE ("CENTRAL COMMITTEE") ISSUED A COMPLAINT AGAINST CRESTWOOD CAPITAL MANAGEMENT, INC. ("CCM") AND MELVIN DAVIS ("DAVIS"). THE COMPLAINT ALLEGES THAT CCM AND DAVIS VIOLATED NFA COMPLIANCE RULE 2-5 BY FAILING TO COOPERATE FULLY AND PROMPTLY IN AN NFA EXAMINATION. THE COMPLAINT ALSO ALLEGES THAT CCM VIOLATED NFA COMPLIANCE RULES 2-10, 2-19(B) AND 2-26 BY FAILING TO MAINTAIN ADEQUATE BOOKS AND RECORDS, BY FAILING TO RETAIN CUSTOMER ACKNOWLEDGEMENTS OF THE RECEIPT OF DISCLOSURE STATEMENTS, AND BY FAILING TO MAINTAIN CUSTOMER AGREEMENTS; VIOLATED NFA COMPLIANCE RULE 2-30(G) BY FAILING TO MAKE OR OBTAIN A RECORD CONTAINING CUSTOMER INFORMATION; VIOLATED NFA COMPLIANCE RULES 2-8(A) AND 2-8(B) BY FAILING TO IDENTIFY DISCRETIONARY ACCOUNTS AND BY FAILING TO HAVE WRITTEN PROCEDURES FOR THE REVIEW OF DISCRETIONARY ACCOUNTS; VIOLATED NFA COMPLIANCE RULE 2-15 BY FAILING TO ADOPT AND ENFORCE WRITTEN OPTION PROCEDURES; AND, VIOLATED NFA COMPLIANCE RULE 2-29(B)(2) BY USING PROMOTIONAL MATERIAL WHICH CONTAINS MISSTATEMENTS OF FACTS OR OMITS A FACT WHICH MAKES THE PROMOTIONAL MATERIAL MISLEADING. Decision:
ON JUNE 21, 1990, THE CENTRAL COMMITTEE ISSUED A DECISION IN WHICH IT EXPELLED CCM FROM NFA MEMBERSHIP AND PER- MANENTLY BARRED DAVIS FROM ASSOCIATION WITH ANY NFA MEMBER AND FROM NFA MEMBERSHIP. THE RESPONDENTS FAILED TO APPEAR AT THE TIME SET FOR CONSIDERATION OF THIS MATTER AND CONSEQUENTLY WAIVED THEIR RIGHTS TO PARTICIPATE. THE CENTRAL COMMITTEE FOUND THAT CCM AND DAVIS VIOLATED ALL OF THE ALLEGATIONS THAT THE COMPLAINT CHARGED THEY VIOLATED. SPECIFICALLY, THE CENTRAL COMMITTEE FOUND THAT CCM AND DAVIS FAILED TO COOPERATE WITH NFA IN ITS INVESTIGA- TION OF THEIR COMMODITY FUTURES BUSINESS IN VIOLATION OF NFA COMPLIANCE RULE 2-5 AND VIOLATED NFA COMPLIANCE RULE 2-4 BY ACCEPTING LOANS FROM INDIVIDUALS WHEN THEY HAD NO EXPECTATION OF REPAYING THE PRINCIPAL OR INTEREST ON THE LOANS.
Source: National Futures Association
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