For Release: July 9, 2002
SIX COFFEE, SUGAR & COCOA EXCHANGE FLOOR BROKERS CHARGED BY CFTC WITH UNLAWFULLY TRADING COFFEE FUTURES
Carmelo Contrino, Robert Disarro, Joseph Gugliaro, and Persio Paulino Charged with Fraud, Bucketing of Customer Orders, Wash Sales and Accommodation Trades, Non-Competitive Trading, and Reporting Non-Bona Fide Prices
William Overland and John Joyce Charged with Wash Sales and Accommodation Trades, Non-Competitive Trading, and Reporting Non-Bona Fide Prices
WASHINGTON, D.C. – The Commodity Futures Trading Commission (CFTC) announced today the filing of an administrative action against Carmelo Contrino of Marlboro, New Jersey; Robert Disarro, of North Brunswick, New Jersey; Joseph Gugliaro of Staten Island, New York; John Joyce of North Arlington, New Jersey; William Overland of Andover, New Jersey; and Persio Paulino of Hoboken, New Jersey, all of whom are registered with the CFTC as floor brokers. The CFTC complaint alleges that, from January 2000 through October 2000, the respondents unlawfully executed coffee futures trades on the Coffee, Sugar & Cocoa Exchange (CSCE), a division of the New York Board of Trade.
According to the CFTC complaint, Contrino, Disarro, Gugliaro, and Paulino fraudulently executed trades in the coffee futures ring of the CSCE, by trading for their own accounts indirectly opposite their customer orders. During this same time, Contrino, Gugliaro, and Paulino knowingly or recklessly traded ahead of executable customer orders on the same side of the market and allocated trades to their personal accounts at better prices than those received by their customers, according to the complaint. By engaging in noncompetitive trading, the complaint alleges, Contrino, Disarro, Gugliaro, Joyce, Overland, and Paulino also reported prices on their trading cards, to their customers, and to the CSCE, that were not bona fide. The complaint further charges that Contrino, Disarro, Gugliaro, Joyce, Overland, and Paulino traded noncompetitively and entered into illegal wash sales and accommodation trades by assisting Contrino, Disarro, Gugliaro, and Paulino in taking the opposite side of their customers orders. Contrino and Gugliaro also failed to record required trading information on their trading cards, according to the complaint.
A public hearing has been ordered to determine whether the allegations are true and, if so, what sanctions are appropriate and in the public interest. Potential sanctions include cease and desist orders, restitution to defrauded customers, civil monetary penalties, trading prohibitions, and registration revocations, suspensions or restrictions.
The following Division of Enforcement staff are responsible for the case: Richard Wagner, John Dunfee, Jason Gizzarelli and Margaret Kanyan.
A copy of the CFTC complaint can be found at www.cftc.gov.
Internet links to complaint appendices (MS Excel Spreadsheets):
Appendix B – Contrino,
Appendix B – Gugliaro.
Richard Wagner, Associate Director
CFTC Division of Enforcement