Release:#3964-96 (Civ 96-14284)

For Release: November 5, 1996

FLORIDA FEDERAL COURT ENTERS EX PARTE ASSET FREEZE ORDER IN JOINT

CFTC-STATE OF FLORIDA ANTI-FRAUD ACTION AGAINST JAMES V. DOWLER, JR. AND DOWLER & BEEKMAN TRADING CO. LTD., BOTH OF VERO BEACH, FLORIDA

Complaint Filed by the CFTC, with Florida's Department of Banking and Finance as

Co-Plaintiff, Charges Defendants with Cheating, Defrauding and Embezzling More than $400,000 from Customers

WASHINGTON -- The Commodity Futures Trading Commission (CFTC) announced today that on November 4, 1996, the Honorable James C. Paine of the U.S. District Court for the Southern District of Florida in West Palm Beach issued an ex parte restraining order freezing the assets of James V. Dowler, Jr. (d/b/a Dowler & Beekman) and Dowler & Beekman Trading Company, Ltd. (D&B Trading), both of Vero Beach, Florida. The order also prohibits the destruction of books and records and requires defendants to provide the CFTC with access to the defendants' books and records.

Dowler has not been registered with the CFTC in any capacity since 1986, and D&B Trading has never been registered with the Commission in any capacity.

The court's action stems from an eight-count injunctive complaint filed on the same day by the CFTC, with the Florida State Department of Banking and Finance as co-plaintiff, alleging that the defendants violated the Commodity Exchange Act (CEA) and CFTC regulations by embezzling and converting customers' funds to their own personal and business uses, committing fraud by falsely representing the state of customers' accounts, and failing to include the proper information regarding their hypothetical trading performance in advertisements.

In addition, the complaint alleges that the defendants violated the registration provisions of Federal commodity law by acting and operating as an unregistered commodity pool operator (CPO), commodity trading advisor (CTA), and associated person (AP). The defendants, according to the complaint, solicited and misappropriated more than $400,000 from at least three customers in Vero Beach, Florida. The Florida Department of Banking and Finance also charges the defendants with violating the Florida Securities and Investor Protection Act (FSIPA).

The defendants allegedly embezzled customer funds and defrauded customers by diverting customer funds without authority, misappropriating trading profits, failing to disclose substantial trading losses and the diversion and misappropriation of customer funds, and failing to disclose the pooling of customer funds.

In its case against the defendants, the CFTC is seeking preliminary and permanent injunctions prohibiting further violations of Federal commodity law. In addition, the CFTC is seeking disgorgement of ill-gotten gains, restitution to allegedly defrauded customers, and civil monetary penalties of up to $100,000, or triple the monetary gain to defendants, for each violation. The State of Florida is seeking preliminary and permanent injunctions prohibiting further violations of the FSIPA.