For Release:January 4, 1996
CFTC FILES ENFORCEMENT ACTION AGAINST ROBERT A. BESNER AND NEW FOREST CAPITAL MANAGEMENT CHARGING FRAUD AND MISAPPROPRIATION
Illinois Judge Enters Ex Parte Order Freezing the Defendants' Assets and Protecting Books and Records; at Least $2.2 Million of Investors' Funds are Allegedly Missing
WASHINGTON - The Commodity Futures Trading Commission (CFTC) today filed a five-count injunctive complaint in the U.S. District Court for the Northern District of Illinois against Robert A. Besner and New Forest Capital Management, Inc., both of Northbrook, Illinois. Besner, who is registered as an associated person (AP), is also president of New Forest, which is a registered commodity trading advisor (CTA).
The CFTC civil complaint charges that from August 1994 to the present Besner and New Forest violated the anti-fraud, conversion, and registration provisions of the Commodity Exchange Act (CEA) and engaged in CTA fraud.
Today Senior U.S. District Judge John A. Nordberg entered an ex parte restraining order freezing the defendants' assets and prohibiting them from destroying books and records and from denying CFTC representatives access to their books and records. The court also ordered the defendants to appear for a hearing on January 16 on the CFTC's motion for a temporary restraining order.
CFTC Alleges that the Defendants Cheated and Defrauded Commodity Futures Customers, Converted Customer Funds, and Fabricated Account Statements
Specifically, the complaint charges that Besner and New Forest cheated and defrauded investors by misappropriating and converting customer funds, and making misrepresentations and issuing false reports and statements to investors. They allegedly misrepresented to investors that funds in commodity accounts opened in their names would be used to trade commodity futures, that profits had been made in the accounts, and that their accounts had certain balances. The defendants accepted at least $2.7 million from investors, $2.2 million of which is unaccounted for, the CFTC complaint alleges.
In its continuing litigation against the defendants, the CFTC is seeking preliminary and permanent injunctions, in addition to other remedial relief, including an accounting, disgorgement, rescission, and restitution. The complaint also seeks a civil monetary penalty against each defendant of $100,000, or triple the monetary gains to the defendant, whichever is greater, for each violation of the CEA or CFTC regulations.
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