For Release:October 31, 1996
TEXAS COURT ISSUES PRELIMINARY INJUNCTION IN
CFTC ANTI-FRAUD ACTION AGAINST EUGENE MORRIS WALTER OF DALLAS, TEXAS
Court's Action Stems from CFTC Civil Complaint Charging Walter with Defrauding Commodity Customers, Among Other Federal Commodity Law Violations
WASHINGTON -- The Commodity Futures Trading Commission (CFTC) announced today that on October 25, 1996, the U.S. District Court for the Northern District of Texas (Dallas Division) entered a consent order of preliminary injunction against Eugene Morris Walter of Dallas, Texas, stemming from a CFTC complaint filed on September 30, 1996, charging Walter with engaging in fraudulent misconduct involving commodity futures and options trading in violation of the Commodity Exchange Act and CFTC regulations.
The preliminary injunction enjoins Walter from violating the Commission's anti- fraud and registration regulations, as charged in the CFTC complaint. In addition, the order requires Walter to cooperate with the CFTC in locating the allegedly ill-gotten assets, and to provide the court with financial disclosures of dispositions of funds, securities, assets, or other property he owned or owns. The injunctive relief also prohibits Walter from destroying books and records and denying the CFTC access to such records.
The CFTC's complaint charges that, from at least March 1994 to April 1995, Walter, among other things, fraudulently solicited customers by misrepresenting to them the anticipated profits and potential risks of trading commodity futures and options, and misled his customers, through false oral and written statements, into believing their accounts were profitable, when they were actually losing money. Walter also allegedly failed to register with the CFTC, failed to provide required risk disclosure statements to customers, and unlawfully commingled customers' funds with his own and those of other customers. (See CFTC News Release #3947-96, October 1, 1996.)
In its continuing litigation against Walter, the CFTC is seeking a permanent injunction against activities by Walter that violate the CEA or CFTC regulations and other sanctions, including an accounting, disgorgement, restitution to customers, and civil monetary penalties.
The CFTC received assistance from the U.S. Attorney's Office for the Northern District of Texas and the Texas State Securities Commission in filing this case.