SECURITIES EXCHANGE ACT OF 1934
Release No. 49781 / May 27, 2004
File No. 3- 11503
COMMISSION INSTITUTES ADMINISTRATIVE PROCEEDINGS AGAINST BROKER-DEALER AND THREE EMPLOYEES
The Securities and Exchange Commission (Commission) announced that on May 27, 2004, it issued an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934 (the Order) against Currency Trading International, Inc. (CTI), a broker-dealer, Craig A. Cunningham, James R. Kelsall, and Christian J. Weber, based on the entry of a judgment of permanent injunction against them.
The Division of Enforcement alleges in the Order that, on May 3, 2004, after a bench trial, the United States District Court for the Central District of California (District Court) entered a judgment against the respondents, permanently enjoining them from violating the antifraud provisions, specifically, Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The defendants were also ordered to pay disgorgement and civil penalties.
The Division of Enforcement alleges in the Order that the District Court found that CTI operated as an illegal boiler room, in that CTI and the individual respondents sold speculative investments in foreign currency options through high-pressure sales tactics, soliciting new customers by telephone and deliberately creating a false expectation of gain without risk.
A hearing will be scheduled before an Administrative Law Judge to determine whether the Division's allegations in the Order are true, to provide respondents an opportunity to dispute the allegations, and to determine what sanctions, if any, are appropriate and in the public interest. The Commission directed that an administrative law judge issue an initial decision in this matter within 210 days from the date of service of the Order.
See also the Order in this matter