By Frank Tang
NEW YORK (Reuters) - A U.S. federal judge has
issued a preliminary injunction against Hunter Wise Commodities,
to block the company from offering precious metals investments
to the public.
The order, issued by Judge Donald Middlebrooks of the
Southern District Court of Florida, stems from a Commodity
Futures Trading Commission (CFTC) complaint filed last Dec. 5,
the top U.S. derivatives regulator said on Wednesday.
The CFTC alleges that Hunter Wise Commodities, based in Las
Vegas, had improperly taken in at least $46 million from
"hundreds of customers" since July 2011.
Fred Jager, the head of Hunter Wise Commodities, said in a
telephone interview the company did not violate any regulations
and would file an appeal against the preliminary injunction
In a court order, Judge Middlebrooks described Hunter Wise
as "the conductor of the orchestra, with the other defendants
playing instruments at Hunter Wise's direction."
The CFTC said it was seeking a permanent civil injunction
against the defendants, in addition to other remedial relief,
including restitution to customers.
The CFTC's complaint showed how the defendants claimed to
sell physical metals to retail customers. Customers would make a
down payment, and the companies would then arrange loans for the
balance of the purchase price.
But these statements were false, and the transactions were
just paper deals, the CFTC alleges.
Jager, who was the chief executive of Hunter Wise
Commodities until the CFTC assumed control on Monday, said the
company had always complied with the rules of the Uniform
"I do not believe under any circumstances that we have done
anything improper," Jager told Reuters.
In addition, Jager said the company had complied with the
CFTC's requests to provide copies of documents and emails.
The case is United States Commodity Futures Trading
Commission v. Hunter Wise Commodities LLC et al, U.S. District
Court Southern District of Florida No. 9:12-cv-81311-DMM.
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