For Release: October 12, 2006
U.S. Commodity Futures Trading Commission Obtains Federal Court Order Freezing Assets of Tennessee Resident Charged with Fraud in Connection with Operating a Commodity Pool
Christian Kis Is Charged with Issuing False Statements to Investors in the U.S. and the U.K.
Washington, D.C.— The U.S. Commodity Futures Trading Commission (CFTC) announced today that a federal district court in Tennessee entered a restraining order against defendant Christian Kis, freezing Kis’ assets, prohibiting the destruction of documents, and requiring Kis to account for his assets. Kis’ last known residence is in Hendersonville, Tennessee.
The court’s order, entered on October 6, 2006, arises from a CFTC complaint alleging that Kis solicited over $400,000 from investors primarily for purposes of trading commodity futures contracts, lost all of the investors’ money, and then concealed those losses by issuing false statements to investors.
Specifically, the complaint, charges that, from approximately March 2003 through January 2006, Kis used the internet to solicit more than $400,000 from members of the general public in the U.S. and the United Kingdom to purchase shares in Raptor Capital, Inc., a company he formed primarily for purposes of trading commodity futures contracts. As alleged, Kis operated Raptor Capital as a commodity pool and pooled the investors’ funds together in various accounts, including at least one personal trading account.
The value of investors’ shares in Raptor Capital was based on the profitability of Kis’ trading, according to the complaint. Furthermore, the complaint asserts, although Kis was sustaining losses throughout the time he was trading, he routinely sent false written statements to investors indicating that the share price of Raptor Capital was increasing as a result of his supposedly profitable commodity futures trading. Kis purportedly sent investors e-mails, monthly and annual account statements, and Internal Revenue Service Schedule K-1s, which falsely stated that investors had achieved positive returns.
The CFTC complaint also alleges that Kis failed to register with the CFTC as a commodity trading advisor and a commodity pool operator and committed other regulatory violations, including failure to provide required disclosure documents and accepting customer funds in his own name.
In its continuing litigation against Kis, the CFTC is seeking permanent injunctive relief, the return of funds to defrauded customers, the repayment of ill-gotten gains, and civil monetary penalties for each violation of the Commodity Exchange Act. U.S. District Court Judge William J. Haynes, Jr. has scheduled a hearing on the CFTC’s request for a preliminary injunction on October 17, 2006, at 3 p.m.
The CFTC appreciates the assistance of the Securities Division of the Tennessee Department of Commerce and Insurance in this matter.
The following CFTC Division of Enforcement staff members are responsible for this case: Glenn I. Chernigoff, Michael J. Otten, Gretchen L. Lowe, and Richard B. Wagner.
Last Updated: July 26, 2007