NEW YORK HEDGE FUND CHARGED WITH MISAPPROPRIATING MORE THAN $1.1 MILLION IN COMMODITY SCAM
U.S. Commodity Futures Trading Commission Sues Remco Capital Management, Inc., Nutone Asset Management, Ltd., and Andrei Maruha, Alleging They Defrauded at Least 31 Investors
WASHINGTON, D.C. – The U.S. Commodity Futures Trading Commission (CFTC) announced today that on November 16, 2004, a federal district court judge in New York, acting on a CFTC complaint filed earlier that day, issued an order freezing the assets and preventing the destruction of the books and records of defendants Remco Capital Management, Inc. (Remco) and Nutone Asset Management, Ltd. (Nutone), of New York City, and Andrei Maruha of Brooklyn, New York.
Remco and Maruha were charged with fraud for allegedly misappropriating investor funds that were solicited to trade commodity futures, options, and other derivatives. Nutone was charged with fraud for allegedly misrepresenting, in a telemarketing scam soliciting investors for Remco, the size, profitability, and trading record of Remco Investment Funds (RIF), Remco’s alleged hedge fund.
The CFTC also charged Remco and Nutone with failing to register with the Commission as required by the Commodity Exchange Act.
Specifically, the complaint alleges that since at least August 2004, defendant Nutone solicited at least 31 investors to invest more than $1.1 million in RIF. According to the complaint, Nutone made numerous misrepresentations regarding RIF in soliciting investors. Defendants Remco and Maruha then allegedly misappropriated the $1.1 million defendant Nutone had solicited from investors for purported investment in commodity futures, options, and other derivatives. According to the complaint, instead of trading investor funds, defendants misappropriated the funds by, among other things, sending the money to relief defendants Rancon Capital Management Corp. and Karina Mestolo, of Brooklyn, New York. The court-ordered asset freeze also applies to the relief defendants.
The CFTC is seeking a permanent injunction against each defendant, repayment to defrauded customers, a return of all ill-gotten gains from the defendants and relief defendants, and civil penalties for each violation of the Commodity Exchange Act.
The CFTC acknowledges the cooperation and assistance of the U.S. Attorney's Office for the Southern District of New York and the Federal Bureau of Investigation.
The following CFTC Division of Enforcement staff members are responsible for this case: Jamie Brown, Lael E. Campbell, Mary Kaminski, John Dunfee, Paul Hayeck, and Joan Manley.
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