AVENTURA, FL – July 26, 2006 – Jay M. Levy, a commodity options salesman from Aventura, Florida, has been permanently barred from all commodity-related activities and ordered to pay over $746,000 in monetary sanctions following a judgment issued by the U.S. District Court for the Southern District of Florida. The ruling stems from a case brought forth by the Commodity Futures Trading Commission (CFTC) alleging violations of anti-fraud provisions of the Commodity Exchange Act (CEA) and CFTC regulations.
The judgment, delivered by Judge Daniel T. K. Hurley on May 19, 2006, followed a seven-day bench trial. The court found Levy liable for misrepresenting facts and omitting material information to customers while working at United Investors Group, Inc. (UIG), a Boca Raton-based commodity options trading firm. The court denied Levy’s motion to reconsider the judgment on June 28, 2006, with minor clarifications to the asset freeze.
Evidence presented at trial revealed that approximately 75 of Levy’s customers lost some or all of their investments trading options through UIG. Five former customers testified against Levy, claiming he exaggerated potential profits while minimizing the inherent risks. They alleged Levy falsely connected predictable market movements to events like the 2004 presidential election and the Iraq War, promising substantial returns.
Judge Hurley deemed the customer testimonies “credible, consistent, and trustworthy,” contrasting them sharply with Levy’s testimony, which the court found “incredible and evasive.” The judge noted inconsistencies in Levy’s statements and a selective recollection of events. The court awarded full restitution of $146,350 to the five testifying customers, including pre- and post-judgment interest, and imposed a $600,000 civil monetary penalty.
This case is connected to a broader CFTC enforcement action filed in January 2005 against UIG, as well as fellow options salesmen Greg P. Allotta and Michael H. Savitsky III, and UIG principals Paul F. Plunkett and Andrew D. Ross. A consent order permanently barring these individuals and UIG from commodity-related activity and imposing over $24 million in sanctions was entered on June 6, 2006.
Source: CFTC.gov
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