Release: #4184-98
For Release: August 27, 1998

U.S. District Court for the Northern District of Alabama Enters Consent Order of Preliminary Injunction Against Two Defendants in Alabama Commodity Pool Fraud Case

The Commodity Futures Trading Commission (CFTC) announced today that defendants James Michael Hanks (Hanks) and Financial Planning Alliance International (FPAI), two defendants in CFTC v. The ChateauForte Consortium, Inc. et. al. (Case No. CV-98-N-1755-S), without admitting or denying the allegations of the Commission's complaint against them, have consented to a preliminary injunction barring them from violating the antifraud and registration provisions of the Commodity Exchange Act (Act). Judge Edwin L. Nelson of the Northern District of Alabama signed the order on August 24, 1998.

The injunction stems from a five-count complaint filed by the Commission in the Northern District of Alabama on July 7, 1998 (see CFTC News Release #4166-98, July 13, 1998). The complaint alleged that Hanks and FPAI participated with other defendants in soliciting Alabama residents to invest at least $3.4 million in The Millennium Fund, an unregistered commodity pool. The complaint alleged antifraud violations, misappropriation of customer funds, unregistered activity, and various reporting and recordkeeping violations of the Act against Hanks, FPAI, The ChateauForte Consortium, Inc., WorldEx, S.A., John La Tourette, Dr. Richard E. Busch, and William E. Amos. The preliminary injunction leaves in place Judge Nelson's earlier order freezing assets, preserving records, and appointing a receivership over all the named defendants, including Hanks and FPAI.

In the pending litigation, the CFTC seeks an order permanently enjoining the defendants from violations of the Act, requiring the defendants to make an accounting, and requiring the defendants to disgorge profits, to make restitution to defrauded customers, and to pay civil fines not exceeding $110,000 per violation ($100,000 for violations before November 27, 1996) or triple the monetary gain to the defendants.