For Release: February 18, 1998
CFTC FILES COMPLAINT AGAINST JACK DWIGHT CULLEN OF
PARADISE, TEXAS, ALLEGING THAT HE COMMITTED A $174,000 COMMODITY FRAUD AND
OBTAINS AN EX PARTE ASSET FREEZE
WASHINGTON -- The Commodity Futures Trading Commission (CFTC) announced today that on February 13, 1998, it filed a four-count injunctive complaint against Jack Dwight Cullen of Paradise, Texas, in the U.S. District Court for the Northern District of Texas, Fort Worth Division, and that the Honorable John H. McBryde entered a restraining order freezing Cullen's assets, prohibiting him from destroying any of his books and records and requiring him to make the books and records available for inspection and copying by the CFTC.
The complaint alleges that from at least December 1996 until the present, Cullen defrauded at least three investors who had invested at least $174,000 in a commodity pool Cullen operated. The complaint charges that, in operating this pool, Cullen violated the anti-fraud provisions of the Commodity Exchange Act (CEA) by, among other things:
-- misappropriating funds received from investors;
-- misrepresenting to investors that their funds would be used only to trade commodity futures when they were not;
-- falsely representing to investors the profitability of his trading activity; and
-- falsely advertising that trading profits were guaranteed.
The complaint also charges that Cullen violated CFTC regulations by failing to operate his commodity pool as a legal entity separate from himself, accepting funds in his own name and not in the name of a commodity pool, commingling pool assets with his own and engaging in false advertising. The complaint seeks the entry of an order enjoining Cullen from further violations of the CEA and the regulations, an accounting, disgorgement of all benefits received, restitution to the defrauded investors and a civil monetary penalty.
In addition to entering the restraining order, the court scheduled a hearing on the CFTC's motion for preliminary injunction for February 23, 1998 at 8:30 a.m.
The Commission appreciates the assistance of the National Futures Association in this matter.