Release:#3947-96 (CIV 3-96CV2734-T)
For Release:October 1, 1996
CFTC FILES COMPLAINT AND MOTION FOR PRELIMINARY AND PERMANENT INJUNCTIONS IN ACTION AGAINST EUGENE M. WALTER OF DALLAS, TEXAS
CFTC Civil Action Charging Walter with Defrauding Customers While Acting
as an Unregistered Futures Commission Merchant and Commodity Trading Advisor,
Among Other Violations of Federal Commodities Law
WASHINGTON -- The Commodity Futures Trading Commission (CFTC) today announced the filing on September 30, 1996, of a civil injunctive complaint in the U.S. District Court for the Northern District of Texas (Dallas Division) against Eugene M. Walter of Dallas, Texas.
The six-count civil complaint alleges that from at least March 1994 to April 1995, Walter engaged in fraudulent misconduct and other activities involving commodity futures and options trading, all in violation of the Commodity Exchange Act and CFTC regulations. Specifically, the complaint alleges that, among other things, Walter engaged in a scheme whereby he:
--fraudulently solicited customers by misrepresenting to them the anticipated profits and potential risks of trading commodity futures and options;
--misrepresented his track record as a futures and options trader;
--misapplied customer funds intended for customer futures and options trading;
--deliberately misled his futures and options customers, through false oral and written statements, into believing their accounts were profitable when they were actually losing money;
--failed to register with the CFTC as a commodity trading advisor and futures commission merchant, as required;
--failed to provide to customers required (i) risk disclosure statements, (ii) transaction confirmations, and (iii) account information; and,
--unlawfully commingled customers' funds with his own.
In addition to preliminary and permanent civil injunctions against activities by Walter that violate the Commodity Exchange Act or CFTC regulations, the CFTC is seeking other remedial relief, including an accounting, disgorgement of profits, restitution to customers of Walter's ill-gotten gains, and civil monetary penalties.
Walter was formerly registered with the Commission as a commodity trading advisor, but that registration was withdrawn in 1984. He has not been registered with the Commission in any capacity since 1987. Walter was convicted of criminal securities violations under the Texas state securities laws in August 1987.
The CFTC received assistance from the United States Attorney's Office for the Northern District of Texas and the Texas State Securities Commission in filing this case.
# # #