Release: #4585-01 (CFTC Docket # SD 02-01 )
For Release: November 19, 2001

CFTC SEEKS TO SUSPEND OR RESTRICT REGISTRATION OF MIDLAND EURO, INC. OF CALIFORNIA

Midland Euro’s Membership With the National Futures Association Was Recently Suspended

WASHINGTON – The Commodity Futures Trading Commission (CFTC) announced today that it has filed an action seeking to suspend or restrict the registration of Midland Euro, Inc. of Sherman Oaks, California. The CFTC seeks the suspension or restriction of Midland Euro’s registration with the Commission as a futures commission merchant (FCM) based on its recent suspension from membership with the National Futures Association (NFA).

On October 31, 2001 the National Futures Association (NFA) took action against Midland Euro and suspended its NFA membership until further notice. In its action, NFA claimed that Midland Euro had failed to disclose the existence of two customer accounts that comprised a substantial portion of Midland Euro’s business, and had filed false financial reports with the NFA which failed to reflect the liabilities related to the undisclosed accounts. As a result, the NFA found that Midland Euro was unable to demonstrate that it was in compliance with the NFA’s financial requirements. On November 14, 2001, a NFA hearing panel upheld the initial action and Midland Euro’s NFA membership has been suspended indefinitely.

The CFTC action alleges that the action by NFA suspending Midland Euro’s NFA membership provides a basis for suspending or restricting Midland Euro’s FCM registration pursuant to the statutory disqualification procedures of the Commodity Exchange Act, as amended.

The CFTC has ordered that the proceeding be expedited, finding that both the public and Midland Euro itself are entitled to a prompt decision on the question of whether Midland Euro’s FCM registration should be suspended or restricted and that no party to the proceeding will be prejudiced.

Copies of the Notice of Intent to Suspend or Restrict Midland Euro’s CFTC Registration are available on the Commission’s Website at http://www.cftc.gov.

Media Contact:
Jack Barrett, Regional Counsel
CFTC Western Regional Office
Division of Enforcement
(310) 443-4701

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