Release: 5152-06

For Release: January 25, 2006

U.S. Commodity Futures Trading Commission Obtains Federal Court Order Freezing Assets Of California Commodity Pool Operator Galaxy Resources 2000 LLC And Manager Charles A. Defazio In Fraud Action

Washington, D.C.— The U.S. Commodity Futures Trading Commission (CFTC) announced today that on January 10, 2006, the Honorable Roger T. Benitez of the United States District Court for the Southern District of California issued a consent order of preliminary injunction against defendants Charles A. DeFazio of Oceanside, California, and Galaxy Resources 2000, LLC, a Nevada limited liability company that operated in Oceanside. The order freezes assets of both defendants, prohibits them from trading any commodity futures contracts or options pending resolution of the case and enjoins them from further violations of the Commodity Exchange Act.

The order of preliminary injunction stems from a CFTC complaint filed on January 5, 2006. The complaint alleges that, from March through September 2005, DeFazio solicited and accepted at least $900,000 from at least 85 customers while claiming that Galaxy was a profitable commodity pool when, in fact, Galaxy lost more $937,000 trading commodity futures. The complaint also alleges that in September 2005, DeFazio confessed to pool participants that their funds had been wiped out completely. According to the complaint, DeFazio improperly commingled funds, used customer funds to pay personal expenses, and that DeFazio and Galaxy falsely claimed to be registered with the CFTC.

In its continuing litigation against defendants, the CFTC is seeking permanent injunctive relief, the return of funds to defrauded customers, repayment of ill-gotten gains, and an award of civil monetary penalties.

The following CFTC staff members are responsible for this case: William P. Janulis, Michael Tallarico, Cynthia Cannon, Scott R. Williamson, Rosemary Hollinger, and Joan Manley.

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The CFTC encourages members of the public to bring to our attention any suspicious activities involving futures or commodity options, including matters involving foreign currency (forex) investments or suspicious Internet websites.

You may contact the CFTC at 1-866-FON-CFTC (1-866-366-2382), visit us at our Customer Protection web page: (/cftc/cftccustomer.htm), or fill out our Internet Report Form identifying your concerns (/enf/enfform.htm).

In addition, the CFTC publishes a series of Consumer Advisories at /cftc/cftccustomer.htm#advisory alerting the public to warning signs of possible fraudulent activity and offering precautions individuals should take before committing funds.

Media Contacts
Alan Sobba

Dennis Holden

Last Updated: April 19, 2007