#4413-00 (CFTC Docket No. 00-23)
For Release: June 30, 2000
CFTC FILES AND SETTLES ENFORCEMENT ACTION AGAINST
IRA M. LAVENDER IN CASE INVOLVING THE FRAUDULENT
SOLICITATION OF CLIENTS
WASHINGTON--The Commodity Futures Trading Commission (CFTC) announced today the issuance of an order instituting administrative proceedings against, and simultaneously accepting an offer of settlement from, Ira Monroe Lavender of Mesa, Arizona, who has never been registered with the Commission in any capacity.
The CFTC’s order finds that Lavender acted as an unregistered commodity trading advisor (CTA) and fraudulently solicited clients to trade commodity futures. In consenting to the entry of the order, Lavender neither admitted nor denied the findings made in the order.
The CFTC order specifically finds that from February 1999 to September 1999, Lavender directed the trading in 10 accounts pursuant to powers of attorney and generally held himself out as a CTA without being registered as such in violation of section 4m(1) of the Commodity Exchange Act (CEA). The order also finds that in the course of soliciting clients, Lavender guaranteed profits and misrepresented the likelihood of generating profits from trading commodity futures in violation of sections 4b(a)(i) and (iii) and 4o(1) of the CEA. All the accounts traded by Lavender, including his own, sustained trading losses, according to the order.
The CFTC order:
requires Lavender to cease and desist from violating the CEA as charged;
permanently prohibits Lavender from trading on or subject to the rules of any contract market and requires all contract markets to deny Lavender trading privileges; and
prohibits Lavender from applying for registration in any capacity or seeking an exemption from registration, from engaging in any activity that requires registration or exemption from registration, and from acting as a principal, agent, or officer of any person registered, exempted from registration or required to be registered with the Commission.
The Arizona Corporation Commission (ACC) also brought an action against Lavender. On April 28, the ACC entered an Order of Relief and Consent to Same. In that order, the ACC found that, in connection with the offer and sale of securities in the form of investment contracts, Lavender made misrepresentations in violation of the Arizona anti-fraud statutes. Lavender consented to the order, which requires him to (1) cease and desist from the conduct alleged, including managing or trading commodity futures accounts for the benefit of investors; (2) pay restitution to his customers in the amount of $175,000 plus interest; and (3) pay a $10,000 penalty.