Release: #4042-97 (CFTC Docket #97-13)
For Release: August 7, 1997
CFTC CHARGES GLOBAL CURRENCIES LTD., LEON LEVITIS, ILYA LEVITIS, ALEX EFROSMAN, AND PAUL MANFRE WITH FRAUD IN THE SALE OF ILLEGAL FOREIGN CURRENCY FUTURES CONTRACTS
Respondents Are Also Charged With Bucketing Customer Orders, Issuing False Reports, Converting Customer Funds, and With Registration Violations
WASHINGTON -- The Commodity Futures Trading Commission (CFTC) today announced the filing of an eight-count administrative complaint charging Global Currencies Ltd., of New York, New York, and its three co-founders: Leon Levitis of Brooklyn, New York; Ilya Levitis of Brooklyn, New York; and Alex Efrosman of New York, New York; and Global's sales manager and chief trader, Paul Manfre, of Brooklyn, New York, with, among other things, fraudulently selling illegal foreign currency futures contracts to the general public.
With the exception of Ilya Levitis, none of the respondents has ever been registered with the CFTC in any capacity. Ilya Levitis was registered with the CFTC between July 1993 and September 1995 as an associated person of I&L Global Consultants, Ltd., a commodity trading adviser.
The CFTC complaint charges that, between October 1994 and October 1995, Leon and Ilya Levitis, who are brothers, and Global Currencies offered and sold illegal foreign currency futures contracts; cheated and defrauded customers in connection with the offer and sale of such contracts; issued false reports and statements to customers; bucketed customer orders; commingled and converted customer funds; and violated the CFTC's registration requirements -- all in violation of the Commodity Exchange Act (CEA) and CFTC regulations. Efrosman and Manfre are charged with committing fraud, offering and selling illegal futures contracts, and with registration violations.
Specifically, the CFTC complaint alleges that the respondents cheated and defrauded customers through false claims and misrepresentations concerning the likelihood of profit and the risk of loss, the placement of customer orders with foreign exchange dealers, the profitability of previous investments made by customers at Global, the safety associated with an investment at Global, and the experience and expertise of Global and its traders. The respondents are also charged with misrepresenting that customers' money would be held in segregated accounts and be returned upon demand.
A public hearing is to be held to determine whether the allegations against the Respondents are true and to determine what sanctions should be imposed. Possible CFTC sanctions include: cease and desist orders prohibiting the respondents from violating provisions of the CEA and CFTC regulations; trading prohibitions; restitution of customer losses; and civil penalties of not more than the higher of $100,000 or triple the monetary gain to the respondents for each violation of the CEA and CFTC regulations.