Welcome to the web page established to provide public information
and updates regarding CFTC v. Equity, et al.
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General Status
The action filed by the Commission on April 1, 2004, has earmarks of being a very large, complicated matter.
The specific allegations in the complaint were based on the limited information known to the Commission at the time, without benefit of discovery. There are two litigation steps in the immediate horizon. First, the Commission currently is opposing a motion by a group of foreign entities known as the Sterling Group to intervene in this action and gain release of frozen funds which they claim belong to them. This matter went to hearing on May?nd is scheduled to resume on May? Second, Judge Kugler has scheduled this matter for hearing on June? 2003 to consider the Commission.s request that the court enter a preliminary injunction to enjoin the defendants from engaging in illegal activities pending final resolution of this case.
It is a regrettable fact of litigation that the agency cannot discuss all the facts as they are learned with each investor. Here, it appears that Tech Traders not only traded Shasta.s funds in its own name, but that it commingled Shasta.s funds with those of others. A shortfall is anticipated. At this point, it is unlikely that the Receiver will be in a position to distribute any funds in the near future. We realize that the loss of liquidity and potential loss of principal may pose a hardship to investors. Unfortunately, it would be imprudent to release any funds until the universe of claims and the particularities of the involvement of the defendants, investors and others are known.
We appreciate your ongoing patience and cooperation.
June 4, 2004
Case status via teleconference with court: Preliminary Injunction hearing rescheduled from 6/18/04 to 7/16/04 at 1:30 p.m.
June 1, 2004
Initial Report filed by Temporary Equity Receiver
May 28, 2004
Answer to Complaint filed by Defendant Tech Traders, Inc.
May 17, 2004
Schedule of Receipts and Statement from the Depository as filed by Temporary Equity Receiver
May 14, 2004
Honorable Judge Kugler entered an order denying Sterling Group's Motion to Intervene and Sterling Group's Application for Release of Restraining Funds
May 7, 2004
HEARING before Judge Kugler begun, to reconvene on 5/13/04 at 9:00 a.m.
CFTC files Plaintiff.s Memorandum in Opposition to the Motion of Sterling Entities to Intervene, Application for an Order to Show Cause and Application for Release of Funds
Answer to Complaint filed by Defendants Equity Financial Group, LLC, Vincent J. Firth and Robert W. Shimer
April 30, 2004
HEARING before Judge Kugler set for 5/7/04 at 2:00 p.m. TO SHOW CAUSE on why an order should not be entered permitting Sterling ACS, Limited, Sterling Bank Limited, Sterling Casualty & Insurance, Ltd., Sterling (Anguilla) Trust, Ltd.; to intervene in this action and releasing the funds belonging to these entities which are now restrained pursuant to this Court.s April 1, 2004 injunction order
MOTION to Intervene by STERLING INVESTMENT MANAGEMENT LTD., STERLING TRUST, LTD., STERLING BANK LIMITED, STERLING CASUALTY AND INSURANCE, LTD., STERLING ACS, LTD.
Setting returnable date as to MOTION to Intervene for 6/4/2004 before Judge Robert B. Kugler
MOTION for Martin P. Russo, Esq. Leave to Appear Pro Hac Vice by STERLING ACS, LTD., STERLING BANK LIMITED, STERLING CASUALTY AND INSURANCE, LTD., STERLING INVESTMENT MANAGEMENT LTD., STERLING TRUST, LTD.
ORDER granting Motion for Martin P. Russo, Esq. Leave to Appear Pro Hac Vice
April 29, 2004
ORDER granting permission to Employ Sachnoff & Weaver. Ltd. and Pepper Hamilton LLP as Receiver's Counsel and FGMK, LLC as Receiver's Accountants filed by STEPHEN T. BOBO
April 28, 2004
ORDER permitting Samuel F. Abernethy, Esq. and Paul M. Hellegers, Esq. to appear pro hac vice on behalf of defendant Equity Financial Group, LLC.
CONSENT ORDER extending time for defendant Tech Traders, Inc. until May 28, 2004 to file an answer to plaintiff's complaint
April 26, 2004
MOTION for Martin H. Kaplan, Esq. and Melvyn J. Falis, Esq. Leave to Appear Pro Hac Vice by TECH TRADERS, INC
NOTICE of Appearance by CIRINO M. BRUNO on behalf of TECH TRADERS, INC.
April 20, 2004
NOTICE of Appearance by LEWIS B. COHN on behalf of EQUITY FINANCIAL GROUP LLC, VINCENT J. FIRTH, ROBERT W. SHIMER
MOTION Permission to Employ Sachnoff & Weaver. Ltd. and Pepper Hamilton LLP as Receiver's Counsel and FGMK, LLC as Receiver's Accountants by STEPHEN T. BOBO
April 13, 2004 . Members of the public who have information to share including details regarding their interests in the pool can complete this hyperlinked Initial Questionnaire (in Word format) (PDF Format) and send copies of all relevant records including: trading activity statements, K-1s, copies of checks or wires, correspondence, email, account opening documents, agreements and contracts to:
Joy McCormack, Investigator
U.S. Commodity Futures Trading Commission
Division of Enforcement
525 West Monroe
Suite 1100
Chicago, Illinois 60661
Shasta@CFTC.gov
April 8, 2004 . Status hearing held. Judge Kugler scheduled a hearing on the preliminary injunctive relief sought by CFTC for June 18, 2004 at 9:30 a.m. in Courtroom 4D of the Mitchell H. Cohen Federal Bldg. & U.S. Courthouse, 1 John F. Gerry Plaza, Camden, NJ 08101.
April 6, 2004 . CFTC issues press release - cftc.gov.
April 1, 2004 - Honorable Judge Robert B. Kugler of the U.S. District Court for the District of New Jersey entered a statutory restraining order against the defendants, freezing their assets and preventing the destruction or alteration of their books and records. Judge Kugler also appointed a receiver with powers to, among other things, take immediate possession, custody, and control of certain assets and property and the books and records of the defendants and take all steps necessary to secure and protect the assets and property of the pool.
April 1, 2004 . U.S. CFTC Files Complaint against Equity Financial Group, LLC (.Equity.), Tech Traders, Inc., Vincent J. Firth (.Firth.), and Robert W. Shimer (.Shimer.). The complaint charges defendants Equity and Firth with fraud in the solicitation of commodity pool participation interests in Shasta Capital Associates, LLC (Shasta), a Delaware corporation. The CFTC's complaint also charges Tech Traders and Shimer with regulatory violations. In its continuing litigation against defendants, the CFTC is seeking preliminary and permanent injunctive relief, refunds to customers, repayment of ill-gotten gains, and monetary penalties.
Contacts:
Public inquiries can be directed to the CFTC at Shasta Email.
Public inquiries regarding the status of claim information can be made with the court appointed receiver: Mr. Stephen Bobo, Sachnoff & Weaver, Ltd., 30 South Wacker Drive, 29th Floor, Chicago, IL 60606-7484.
Media Case Contact (No customer inquiries, please):
Rosemary Hollinger
Associate Director and Regional Counsel
CFTC Division of Enforcement
525 West Monroe
Suite 1100
Chicago, Illinois 60661
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