For Release: February 2, 2006
US Commodity Futures Trading Commission Finds That Commodity Trading Advisor Misled Public About Commodity Options Trading System
Respondents James R. Burgess and Optioneer Inc. Settle Charges That They Made False Website Claims About Profitability
Washington, D.C.— The US Commodity Futures Trading Commission (CFTC) announced today the filing and simultaneous settlement of an administrative enforcement action against respondents James R. Burgess of Newport Beach, California, and his firm, Optioneer Inc. (Optioneer). The CFTC order finds that they used misleading advertising on the Internet in the sale of a commodity options trading system and related products and services.
Specifically, the order finds that, between August 2002 and July 2004, Burgess and Optioneer fraudulently solicited clients through the www.Optioneer.com website to purchase an options trading system known as The Optioneer System, which included hardware, software, training, technical support, monthly data, and market information. According to the order, the respondents falsely touted substantial profits from using The Optioneer System, failed to disclose that certain performance histories posted on the Optioneer website were based on hypothetical or simulated trading rather than actual trading, and failed to provide the required disclosure statement concerning the inherent limitations of hypothetical or simulated trading.
The order requires Burgess and Optioneer to pay a $130,000 civil monetary penalty; cease and desist from further violations of the Commodity Exchange Act (CEA) and CFTC regulations, including refraining from making unsubstantiated claims of profits or limited risk in the use of commodity trading systems or methods; and implement certain procedures to ensure compliance with the CEA and regulations.
The following Division of Enforcement staff members were responsible for this case: Eugene Smith, Christine Ryall, Paul Hayeck, 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.
Last Updated: April 12, 2007