Release #4271-99 (98 Civ. 5588)
For Release: May 27, 1999
New York Court Orders Defendants to Pay Over $8.1 Million in Civil Monetary Penalties and Orders Restitution of More Than $2.7 Million to Customers in CFTC Illegal Foreign Currency Futures Fraud Action
CFTC's 1998 Anti-Fraud Enforcement Action Alleged that the Defendants Cheated and Defrauded Customers Out of Over $3.5 Million
WASHINGTON – The Commodity Futures Trading Commission (CFTC) announced today that on May 11, 1999, the Honorable Allen G. Schwartz of U.S. District Court for the Southern District of New York entered a final judgment and order against New York Currency Exchange Corp, New York Currency Research Corp. (both located in New York, New York), and Michael T. Matejka, president of both corporations, ordering the defendants to jointly and severally pay $2,701,486 in restitution to customers and to pay a civil monetary penalty of $8,104,458.
The judgment also permanently enjoins the defendants from violating the provisions of the Commodity Exchange Act (CEA) and CFTC regulations alleged in the CFTC complaint filed against the defendants on August 6, 1998, and rescinds all contracts entered into by the defendants with their customers.
The judgment is a culmination of proceedings stemming from the 1998 CFTC complaint, which alleged that the defendants violated the anti-fraud, registration, and various other provisions of the CEA and CFTC regulations by cheating and defrauding customers, offering and selling illegal foreign currency futures contracts, commingling and converting customer funds, bucketing customer orders, and operating as an unregistered futures commission merchant. Shortly after the complaint was filed, the court entered an ex parte order, and subsequently a preliminary injunction, which, among other things, froze the defendants' assets (see CFTC News Releases #4177-98, August 12, 1998, and #4089-97, December 18, 1997).
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