U.S. COMMODITY FUTURES TRADING COMMISSION CHARGES THREE ADDITIONAL DEFENDANTS IN PENDING TENNESSEE FRAUD ACTION
Amended Complaint Alleges that Gordon J. Vandeveld, Ernst H. Behr, and Reverie LLC Made Fraudulent Misrepresentations When Soliciting Customers to Purchase Foreign Currency Futures
Washington, D.C. – The U.S. Commodity Futures Trading Commission announced today the filing of an amended complaint naming additional defendants Gordon J. Vandeveld of Northfield, Illinois; Ernst H. Behr of Reno, Nevada; and Reverie LLC (Reverie) of Glen Ellyn, Illinois in a civil antifraud action pending before U.S. District Judge Bernice B. Donald in Memphis, Tennessee (CFTC v. FxTrade Financial LLC, Jeffrey A. Mischler, Lee N. Romano, and Mary Jo Sibbitt, Civil Action No.: CV: 04-2181-BBD). Joseph J. Cecala, Jr., Esq. of Park Ridge, Illinois was named as a relief defendant.
The CFTC’s amended complaint alleges that Vandeveld, Behr, and Reverie LLC defrauded customers of FxTrade, a defendant in the pending litigation, by misrepresenting investments, profitability, the amount of due diligence defendants performed, and FxTrade's history. According to the amended complaint, Reverie, Vandeveld, and Behr received tens of thousands of dollars in commissions while generating hundreds of thousands of dollars for FxTrade.
As alleged, Cecala, an attorney for FxTrade and Mischler, was named as a relief defendant on the grounds that FxTrade customers sent almost $300,000 of the $1.1 million solicited directly to Cecala. Cecala is not charged with wrongdoing in the scheme, but is named as a party who may hold recoverable proceeds from the alleged scheme.
The pending action, filed March 17, 2004, initially charged FxTrade Financial, LLC, (FxTrade) Jeffrey A. Mischler (Mischler), both of Germantown, Tennessee, Lee N. Romano II (Romano) of Union, Illinois, and Mary Jo Sibbitt (Sibbitt) of Glen Ellyn, Illinois, with fraudulently soliciting FxTrade customers to open foreign currency trading (forex) accounts by making misrepresentations about the company’s profitability, guarantees of success, and date of inception, all in violation of the Commodity Exchange Act (CEA) (see CFTC News Release 4904-04, March 23, 2004). As alleged, all named defendants solicited a total of more than $1.1 million from a number of investors.
Previously, on March 17, 2004, the court entered an order and froze the assets of FxTrade, Mischler, Romano, and Sibbitt. On April 22, 2004, the court entered consent orders continuing the asset freeze and prohibiting those defendants from further violating the CEA.
The CFTC, in its continuing litigation against all defendants, seeks permanent injunctive relief, refunds to customers, repayment of ill-gotten gains, and monetary penalties.
The following CFTC Division of Enforcement staff are responsible for this case: Charles D. Marvine, Rachel A. Hayes, Lacey Dingman, and Richard Glaser.
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