CFTC Press Release 4358-00

CFTC ACCEPTS SETTLEMENT OFFERS OF LEON LEVITIS, ILYA LEVITIS, AND PAUL MANFRE IN CONNECTION WITH THE FRAUDULENT SALE OF ILLEGAL FOREIGN CURRENCY FUTURES CONTRACTS

Order Finds That Leon Levitis, Ilya Levitis, and Paul Manfre Fraudulently Solicited Customers To Enter Into Illegal Foreign Currency Futures Contracts And That Leon Levitis and Ilya Levitis Also Made and Issued False Reports, Bucketed Customer Orders, and Converted and Commingled Customer Funds

WASHINGTON � The Commodity Futures Trading Commission (CFTC) announced today that on February 4, 2000, it issued an order accepting offers of settlement from Leon Levitis, Ilya Levitis, and Paul Manfre, all of Brooklyn, N.Y., in connection with a complaint alleging, among other things, the fraudulent solicitation of customers in the offer and sale of illegal foreign currency futures contracts. The settlement stems from a complaint filed by the CFTC against them on August 7, 1997 (see CFTC News Release 4042-97, August 7, 1999).

The CFTC settlement order finds that L. Levitis, I. Levitis, and Paul Manfre defrauded customers of Global Currencies, Ltd. of New York, N.Y., in the offer and sale of illegal foreign currency futures contracts to more than 100 retail customers on a board of trade operated by Global that was not designated by the CFTC as a contract market, and that they operated Global as an unregistered futures commission merchant.

Specifically, the order finds that the three respondents defrauded customers by making false representations concerning, among other things, the profitability of prior investments by Global customers, the risk involved in trading foreign currency contracts, and the experience and expertise of Global and its traders, in violation of section 4b(a)(i) of the Commodity Exchange Act (CEA).

The CFTC order also finds that L. Levitis and I. Levitis solicited and accepted over $2.1 million from retail customers for the purpose of trading foreign currency futures contracts, committed fraud, made and issued false reports, bucketed customer orders, and converted and commingled customer funds, in violation of sections 4b(a)(i), 4b(a)(iii), 4d, and 9(a) of the CEA. In addition, the order finds that L. Levitis, I. Levitis, and Manfre failed to register as associated persons of Global, in violation of section 4k of the CEA.

The CFTC order also finds L. Levitis and I. Levitis liable, as controlling persons of Global, for violations of sections 4b(a)(i), 4b(a)(iii), 4b(a)(iv),4d, and 9(a) of the CEA and section 1.20 of the Commission regulations.

L. Levitis and I. Levitis, without admitting or denying the findings in the order, consented to the entry of an order:

directing them to cease and desist from further violations of the CEA and Commission regulations as charged;
permanently prohibiting them from trading on or subject to the rules of any contract market;
noting the appropriateness of a civil monetary penalty, but waiving a civil monetary penalty based upon their demonstrated inability to pay; and
requiring them to comply with certain undertakings, including their agreement to never apply for registration with the Commission in any capacity or engage in any activity requiring such registration.

Manfre, without admitting or denying the findings of the order, consented to the entry of an order:

directing him to cease and desist from further violations as charged; and
noting the appropriateness of a civil monetary penalty and restitution, but waiving both based upon his demonstrated inability to pay.