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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 16768 / October 16, 2000

FEDERAL COURT JUDGE HOLDS DEFENDANT ERIC V. BARTOLI IN CIVIL CONTEMPT AND ENTERS A DEFAULT JUDGMENT IN FAVOR OF SEC

Securities and Exchange Commission v. Latin American Services Co., Ltd., Cyprus Funds, Inc., Eric V. Bartoli, Douglas R. Shisler, James L. Binge And Peter J. Esposito, Case No. 99-2360-CIV-UNGARO-BENAGES (S.D. Fla.)

The Securities and Exchange Commission ("SEC") announced that on September 15, 2000, the Honorable Ursula Ungaro-Benages of the United States District Court for the Southern District of Florida entered an Order holding Defendant Eric V. Bartoli ("Bartoli") in civil contempt for failing to comply with a previous Court Order commanding that he deliver his passport to the Clerk of the Court. Judge Ungaro-Benages held that Bartoli's refusal to comply with the prior Court Order was "willful and flagrant" and sanctioned Bartoli by striking his pleadings and entering a default judgment against him. Judge Ungaro-Benages also issued a Writ of Bodily Attachment providing for Bartoli's immediate arrest. Bartoli was arrested on September 21, 2000, and released later that day when he surrendered his passport to United States Magistrate Judge Muirhead of the United States District Court for the District of New Hampshire.

Bartoli was the principal of Cyprus Funds, Inc. ("Cyprus Funds"), an unregistered foreign mutual fund, and its investment advisor Latin American Services Co., Ltd. (Lasco). In its Complaint, filed on August 27, 1999, the SEC alleged that Bartoli and the other directors of Cyprus Funds raised over $100 million from investors in the U.S. and in Latin America through the sale of unregistered mutual fund shares. Most of the funds raised were misappropriated by Defendants, diverted to pay investors of another scheme and, in a Ponzi-like fashion, used to pay interest to Cyprus Funds investors.

http://www.sec.gov/litigation/litreleases/lr16768.htm


Modified:10/18/2000