Release: #4286-99 (99-Civ. 4822)
For Release: July 13, 1999
CFTC FILES AND SETTLES SIX-COUNT INJUNCTIVE ACTION AGAINST MORRIS J. BENUN, CHARGING THAT HE COMMITTED FRAUD AND CONVERTED FUNDS WHILE OPERATING TWO COMMODITY POOLS
Benun Ordered To Pay Over $ 1 Million In Restitution To Pool Participants And Is Permanently Barred From The Commodities Industry By Consent Permanent Injunction
WASHINGTON -- The Commodity Futures Trading Commission (CFTC) announced the filing of a six-count injunctive complaint against Morris J. Benun of Brooklyn, New York, alleging that, from January 1990 through January 1996, Benun violated anti-fraud provisions of the Commodity Exchange Act (CEA) in operating two commodity pools, Benun Futures Fund and Aspen Capital Management Fund, L.P. Benun was registered with the CFTC from 1989 through 1990 as an introducing broker and from 1989 until 1996 as a commodity trading advisor and a commodity pool operator.
The complaint was filed on July 2, 1999, and on July 6, 1999, the Honorable Lewis A. Kaplan of the U.S. District Court of the Southern District of New York entered a consent order of permanent injunction and other ancillary equitable relief against Benun.
Specifically, the complaint alleges that Benun violated the CEA by, among other things, falsely representing through oral and written statements to pool participants and prospective participants that the pools were profitable when, in fact, they were losing almost all of the approximately $3.6 million invested.
The complaint further alleges that Benun violated other provisions of the CEA and CFTC regulations by, among other things, converting for his own use at least $49,531 in participant funds and commingling property of the pool with the property of others.
Benun, without admitting or denying the allegations of the CFTC's complaint, consented to the entry of the consent order of permanent injunction that:
1) permanently enjoins him from violating sections 4b(a)(i), 4b(a)(ii), 4n(3), 4o(1)(A) and (B), 9(a)(1) of the CEA and sections 1.31, 4.20(c) and 4.23 of the regulations promulgated thereunder;
2) orders him to pay $1,046,516 in restitution, of which $49,531 also constitutes disgorgement to participants, over a period of approximately four years, pursuant to a payment plan previously entered into by Benun with pool participants;
3) prohibits him from ever applying for registration or exemption for registration with the CFTC in any capacity; and
4) permanently bars him from (i) entering into any commodity futures or options transactions for his personal account; (ii) having any commodity futures or options traded on his behalf; (iii) engaging in any activity requiring registration or exemption from registration in any capacity; and (iv) acting as an agent or officer of any person registered or required to be registered with the CFTC.
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