Release: 5153-06

For Release: January 30, 2006

U.S. Commodity Futures Trading Commission Charges Two Staten Island Hedge Funds And Their Principal With Stealing Millions Of Dollars In Foreign Currency Scheme

CFTC Complaint Alleges That Alexsander Efrosman, Century Maxim Fund, Inc., and AJR Capital Inc. Fraudulently Solicited Customers to Trade Foreign Currency Futures Contracts

Washington, D.C.— The U.S. Commodity Futures Trading Commission (CFTC) announced today that it filed a federal injunctive action against Alexsander Efrosman, a/k/a Alex Besser, of Staten Island, New York, and two hedge funds under his control, Century Maxim Fund Inc., and AJR Capital Inc., charging them with fraud in the sale of illegal foreign currency (forex) futures contracts.

Specifically, the CFTC alleges that, between April 2004 and June 2005, defendants fraudulently solicited and obtained more than $5 million dollars from as many as 110 customers for the purpose of trading managed accounts in forex futures contracts that were not, as required, traded on a registered entity. The complaint alleges that defendants misappropriated the funds.

Efrosman was previously indicted for mail and wire fraud relating to foreign currency trading in a different scheme, and fled the country. He subsequently was extradited from France to face trial, and in November 2000, pleaded guilty to nineteen counts of mail and wire fraud before the U.S. District Court for the Southern District of New York, and was sentenced to a term of three years of imprisonment.

The CFTC’s complaint alleges that shortly after his release from prison, Efrosman engaged in a new forex scheme through purported hedge funds Century Maxim Fund and AJR Capital. Allegedly, he fraudulently solicited customers to trade forex through Century Maxim Fund, which, Efrosman falsely represented as a hedge fund that had attracted investments from a large number of high net-worth individuals. The complaint also alleges that Efrosman fraudulently solicited customers for forex trading through AJR Capital, which, Efrosman represented to be an opportunity for customers of more modest means to profit from forex trading. According to the complaint, Efrosman misappropriated more than $300,000 from Century Maxim Fund investors and more than $4.9 million from AJR Capital investors.

The complaint also alleges that Efrosman provided his customers with fictitious Century Maxim and AJR Capital account statements reflecting trades that did not actually occur, and profits that did not exist. According to the complaint, the fictitious statements were instrumental in the propagation of the fraud and the solicitation of new customers. Finally, the complaint alleges that all the purported forex trading Efrosman solicited customers to undertake was illegal, as the contracts he solicited were futures contracts that could only be traded on a registered entity.

The CFTC filed its complaint on September 30, 2005. On that same day, court orders were entered which, among other things, froze defendants’ assets and sealed the complaint. The court’s seal was lifted on January 24, 2006. In its complaint, the CFTC is seeking preliminary and permanent injunctive relief, a freeze of defendants’ funds, restitution for defrauded customers, civil monetary penalties, and disgorgement of ill-gotten gains.

The following CFTC Division of Enforcement staff members were responsible for this action: Stephen R. Morris, John J. Cipriani, David Acevedo, Lenel Hickson, Jr., Stephen J. Obie, and Richard Wagner.

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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 23, 2007