Chicago, IL – A federal court judge in Chicago has issued a preliminary injunction against John M. Marshall, along with Stephen Z. Adams and their companies, Brookshire Raw Materials Management, LLC, Brookshire Raw Materials Group, Inc., and Brookshire and Company, Ltd., following charges of misappropriating over $4.6 million in customer funds. The order, entered on April 13, 2009, by Judge Amy St. Eve, maintains an asset freeze previously issued on February 19, 2009.
The U.S. Commodity Futures Trading Commission (CFTC) alleges that between September 2006 and December 2008, Marshall, Adams, and Brookshire Raw Materials Management accepted funds from customers for investment in a commodity pool, the Brookshire Raw Materials Group Trust. While the investment agreement allowed for limited withdrawals for fees, the CFTC claims Marshall and Adams illicitly withdrew over $5 million from the Trust account, transferring the money to Canadian bank accounts, largely under Marshall’s control.
The CFTC further alleges that Marshall and Adams failed to disclose these unauthorized withdrawals and instead distributed false monthly statements to investors, inflating the value of the Trust. When customers requested to redeem their investments, they received additional deceptive statements regarding their funds, but no actual payouts.
According to the complaint, in December 2008, Marshall and Adams shut down their offices, destroyed computer data, and ignored redemption requests. The CFTC is pursuing a permanent injunction, monetary penalties, and other relief in its ongoing litigation against the defendants.
The case is being prosecuted in the Northern District of Illinois under case number 09-cv-1056. The CFTC staff members responsible for the matter include Elizabeth Streit, Brigitte Weyls, Joy McCormack, Richard Wagner, Rosemary Hollinger, and Scott Williamson. The injunction was issued on April 13, 2009 and announced by the CFTC on April 21, 2009.
Source: CFTC.gov
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