Release #4281-99 (CFTC Docket # 99-13)

For Release: June 28, 1999


CFTC Finds that Godres Defrauded Investors By Concealing Losses Resulting From the Trading of Precious Metal Futures Contracts on Behalf of a Commodity Pool, and Orders Restitution to Defrauded Investors, Among Other Sanctions

WASHINGTON - The Commodity Futures Trading Commission (CFTC) announced today that it issued an order instituting administrative proceedings against and simultaneously accepting an offer of settlement from Ross R. Godres, of Lafayette, Colorado. Godres has never been registered with the CFTC in any capacity.

The CFTC order finds that Godres violated the anti-fraud provisions of the Commodity Exchange Act (sections 4b(a)(i), 4b(a)(ii) and 4o(1)) by fraudulently concealing from commodity pool participants losses he had sustained trading precious metals futures on behalf of the pool and by making verbal misrepresentations and sending sporadic falsified statements to participants that their investments were secure and still intact.

According to the CFTC order, Godres founded Navco Precious Metals Fund, Ltd. (Fund), a Colorado limited partnership, as a commodity pool in May 1993. Godres began trading precious metal futures contracts on behalf of the Fund's five participants in June 1993. The order finds that, within a year, Godres lost almost all of the Fund's assets of over $60,000 unsuccessfully trading futures. The CFTC's order also finds that Godres violated CFTC regulation 4.13(b)(2)(i) by failing to provide pool participants with regular and accurate monthly statements for the Fund.

Godres, without admitting or denying the CFTC's findings, consented to the entry of the order that:

-- directs him to cease and desist from further violations of the provisions of the CEA and CFTC regulations with which he was charged;

-- permanently prohibits him from trading on contract markets;

-- orders him to pay a total of $60,750 as restitution, plus pre-judgment interest, to the pool participants over a five-year period;

-- requires him to liquidate all futures and options positions held by him or on his behalf, or in which he has any beneficial interest; and

-- requires him to comply with his undertakings, including that he never apply for registration or seek exemption from registration with the CFTC in any capacity, and never engage in any activity requiring registration or exemption from registration, or act as an agent or officer of any person registered, exempted from registration or required to be registered with the Commission.

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