U.S. DISTRICT COURT ENJOINS SOUTH CAROLINA RESIDENT GEORGE HEFFERNAN FROM ENGAGING IN COMMODITIES FRAUD; FREEZES ASSETS
Order Arises From Complaint By U.S. Commodity Futures Trading Commission Charging Heffernan, Also Known As “George W. Marshall,” With Fraud for the Third Time in Four Years
WASHINGTON, D.C. – The Commodity Futures Trading Commission (CFTC) announced today that on January 11, 2005, a federal district court judge in South Carolina issued an order of preliminary injunction, enjoining George Heffernan, who has also used the alias “George W. Marshall,” from soliciting clients for his commodity pool and commodity trading advisory service using fraudulent profit guarantees. The court’s preliminary injunction follows a statutory restraining order entered by the court on December 21, 2004, freezing Heffernan’s assets and ordering the preservation of books and records. Heffernan recently moved from Evans, Georgia, to Myrtle Beach, South Carolina.
The court orders stem from a December 16, 2004, CFTC complaint charging Heffernan with fraud in connection with various solicitations of participants for a commodity pool and clients for commodity trading advisory services. The complaint also charges Heffernan with violating a prior CFTC order, failing to register as a commodity pool operator, and failing to make certain disclosures to prospective clients as required by CFTC regulations.
Specifically, the complaint alleges that, in July 2004, Heffernan founded a commodity pool under the name Index Analysis Pool, L.P. and solicited clients and prospective clients by making false representations regarding the profitability of the pool.
The complaint also alleges that prior to, and contemporaneous with, his operation of the Index Analysis Pool, Heffernan acted as a commodity trading advisor offering trading methods, advice and services for compensation under various names. Since at least February 2003, the complaint alleges, Heffernan has marketed this service under the name Index Analysis Service. As alleged, through an Internet website located at www.indexanalysisservice.com, Heffernan offered for sale a daily electronic mail subscription service providing trading advice for S&P 500 and Nasdaq futures contracts, as well as two commodity futures trading methods, marketed as: The Index Analysis No Loss – Hedge Trading Method and The Index Analysis Stop Loss – Hedge Trading Method. The complaint alleges further that Heffernan offered these two trading methods for sale for $25,000 and $5,000, respectively, by making fraudulent representations regarding their profitability.
The complaint not only alleges that Heffernan violated the anti-fraud and registration provisions of the Commodity Exchange Act (CEA) and disclosure requirements of the CFTC’s regulations, but also a prior order of the CFTC. The CEA violations alleged in the recent complaint follow a long history of illegal conduct by Heffernan. In two separate proceedings prior to the filing of the current complaint, the Commission and the U.S. District Court for the Southern District of Georgia each found that Heffernan violated the CEA and CFTC regulations by, among other things, employing a fraudulent scheme designed to defraud his clients and prospective clients (see CFTC News Releases 4442-00, September 7, 2000, and 4830-03, August 7, 2003).
The CFTC is seeking a permanent injunction against Heffernan, repayment to defrauded clients, a return of all ill-gotten gains from the defendant, and civil penalties for each violation of the CEA and the CFTC order.
The CFTC gratefully acknowledges the assistance of the Office of the United States Attorney in Columbia, South Carolina.
The following CFTC Division of Enforcement staff are responsible for this case: Ted Dowd, Patricia Gomersall, Paul Hayeck, and Joan Manley.
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