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JCC, INC
CASE OUTCOME: FINE $250,000
• EXPELLED FROM MEMBERSHIP
NFA ID:
0001612
Complaint:
ON OCTOBER 22, 1990, THE CENTRAL REGIONAL BUSINESS CONDUCT COMMITTEE ("CENTRAL COMMITTEE") ISSUED A COMPLAINT AGAINST JCC, INC. ("JCC"). THE COMPLAINT ALLEGES THAT JCC VIOLATED NFA COMPLIANCE RULES 2-2(a) AND 2-29(a)(1) BY CHEATING, DEFRAUDING OR DECEIVING OR ATTEMPTING TO CHEAT, DEFRAUD OR DECEIVE COMMODITY FUTURES CUSTOMERS AND BY MAKING COMMUNICATIONS WITH THE PUBLIC WHICH OPERATED AS A FRAUD OR DECEIT. THE COMPLAINT ALSO ALLEGES THAT JCC VIOLATED NFA COMPLIANCE RULE 2-29(a)(2) BY USING A HIGH-PRESSURE APPROACH IN ITS SOLICITATION OF CUSTOMERS. THE COMPLAINT FURTHER ALLEGES THAT JCC VIOLATED NFA COMPLIANCE RULES 2-29(b)(1), 2-29(b)(2) AND 2-29(b)(3) BY USING A STANDARDIZED ORAL PRESENTA- TION IN ITS SOLICITATION OF CUSTOMERS WHICH WAS LIKELY TO DECEIVE AND WHICH CONTAINED MATERIAL MISSTATEMENTS OF FACT OR OMITTED FACTS WHICH IT KNEW MADE THE PRESENTATION MISLEADING AND WHICH MEN- TIONED THE POSSIBILITY OF PROFIT WITHOUT MAKING AN EQUALLY PROM- INENT STATEMENT OF THE RISK OF LOSS. THE COMPLAINT ALSO ALLEGES THAT JCC VIOLATED NFA COMPLIANCE RULE 2-30(a) BY FAILING TO OBTAIN INFORMATION ABOUT ITS FUTURES CUSTOMERS WHO ARE INDIVIDUALS AND PROVIDE SUCH CUSTOMERS WITH THE APPROPRIATE RISK DISCLOSURE. JCC IS ALSO ALLEGED TO HAVE VIOLATED NFA COMPLIANCE RULE 2-30(h) BY FAILING TO ADEQUATELY SUPERVISE THE ACTIVITIES OF ITS APS IN OBTAINING INFORMATION FROM AND PROVIDING RISK DISCLOSURE TO CUSTOMERS. THE COMPLAINT FURTHER ALLEGES THAT JCC VIOLATED NFA COMPLIANCE RULE 2-4 BY FAILING TO OBSERVE HIGH STANDARDS OF COMMERCIAL HONOR AND JUST AND EQUIT- ABLE PRINCIPLES OF TRADE. FINALLY, THE COMPLAINT ALLEGES THAT JCC VIOLATED NFA COMPLIANCE RULE 2-9 BY FAILING TO DILIGENTLY SUPERVISE ITS EMPLOYEES AND AGENTS IN THE CONDUCT OF THEIR COM- MODITY FUTURES ACTIVITIES, INCLUDING, BUT NOT LIMITED TO, THEIR SALES PRACTICES AND THEIR COMPLIANCE WITH COMMODITY FUTURES TRADING COMMISSION AND NFA REGISTRATION AND MEMBERSHIP REQUIREMENTS. Decision:
ON AUGUST 25, 1992, A DESIGNATED PANEL OF THE CENTRAL COMMITTEE ISSUED A DECISION TO JCC AFTER A HEARING WAS HELD. THE PANEL EXPELLED JCC FROM NFA MEMBERSHIP AND ORDERED THE FIRM TO PAY A FINE OF $250,000.
Source: National Futures Association
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