CFTC News Release 4424-00 (99-6560-Civ-Dimitrouleas)
For Release July 20, 2000
COURT ENTERS CONSENT ORDER OF PERMANENT INJUNCTION AND OTHER EQUITABLE RELIEF AGAINST DAVID MICHAEL LOYD IN EUROPACIFIC EQUITY AND CAPITAL MANAGEMENT, LTD., COMMODITY POOL FRAUD CASE
Order Requires Loyd to Make Full Restitution of Up to $2.5 Million to Investors
WASHINGTON -- The Commodity Futures Trading Commission (CFTC) announced today that the United States District Court for the Southern District of Florida (Ft Lauderdale Division) entered a consent order of permanent injunction against David Michael Loyd, defendant in CFTC v. Europacific Equity and Capital Management, Ltd., et al. (see CFTC News Release 4264-99, May 19, 1999).
The consent order, entered on July 13, 2000, arises out of a complaint filed by the CFTC on May 5, 1999, alleging, among other things, that Loyd fraudulently solicited members of the public to invest in a commodity pool. The complaint also named as defendants EuroPacific Equity and Capital Management, Ltd. (Europacific), Tortola Corporation Company, Ltd., (Tortola), International Investment Group, Ltd. (IIG), and Richard Tichy.
Loyd, without admitting or denying the findings of the order or the allegations of the complaint, agreed to the entry of the consent order requiring him to make full restitution of up to $2.5 million to investors under an income-based, five-year payment plan. The order also enjoins Loyd from committing fraud in connection with any commodity futures activity, acting as an unregistered commodity pool operator or unregistered associated person of a commodity pool operator, and violating CFTC recordkeeping and disclosure provisions applicable to commodity pool operators. Furthermore, the order bars Loyd from any activity in connection with the commodity futures industry.
The consent order finds that Loyd violated the anti-fraud and registration provisions of the Commodity Exchange Act (CEA) and Commission regulations by fraudulently soliciting and accepting over $2.5�million from at least 104 individuals to invest in a commodity pool variously referred to as either the Europacific Fund or the International Investment Fund (Fund), which was purportedly managed by another defendant, Richard Tichy. The order further finds that in soliciting prospective investors, Loyd recklessly, or with knowing disregard of the truth, misrepresented defendant Tichy�s success as a futures trader and the expected profits from the Fund. The consent order also finds that Loyd sent monthly account statements to investors that falsely represented that the Fund was generating profits, when, in fact, investors never realized any profits from investing in the Fund. Instead, the order finds, defendants Tichy, Europacific, Tortola, and IIG misappropriated the vast majority of the over $2.5 million of investor funds and lost the remaining funds through trading in the commodity futures markets.
Previously, on October�29, 1999, the court entered a default judgment against defendants EuroPacific, Tortola, IIG, and Tichy. The default judgment enjoined those defendants from further violations of the CEA and the CFTC regulations, as charged, and further required them jointly and severally to pay over $10�million in restitution and civil monetary penalties (see CFTC News Release 4337-99, November 12, 1999).
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