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FILED

ZOß9 foAY '4 AM 10: 87

CU::::K u.~. c:s :~!C 'l CC;';~T

CENTRAL DrST, l" CA~Ii-."

LOS ANGf.\'.£~

i: 'l

11 KENT KAWAKAMI, CA Bar No. 149803

United States Attorney's Offce

12 Civil Division

13 300 Nort Los Angeles Street Room 7516

Email: Kent.Kawakami(iusdoj.ov

14 Telephone: (213) 894-4858

15 Facsimile: (213) 894-2380

16 UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA 17

18

19 Case No..SACV09-0578 JVS(RNBKJ

U.S. Commodity Futures Trading

20 Commission,

21 Plaintiff,

22 YS.

CO:MLAINT FOR INJUCTIVE

AND OTHER EQUITABLE RELIEF

AND FOR CIVIL MONETARY

PENALITES PURSUANT TO TH .

COM1ODITY EXCHANGE ACT,

AS AlNDED, 7 U.S.C. §§ l-et seq. 23

24 Gordon A. Driver, Axcess Automation

LLC, and Axccss Fund Management

25 LLC,

26 Defendants.

27

28

DEMAN FOR JURY TRIAL

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i . I. SUMMARY

2 1. From at least in or about Februar 2006 through the present

3 ("Relevant 'Period"), Defendant Gordon A. Driver ("Drivet'), from at least in or

4 about October 2007 through the present Defendant Axcess Automation LLc

5 ("Axcess Automation"), and from at least in or about July 2008 though the present

6 Defendat Axcess Fund Management LLC ("Axcess Fund Management")

7 (collectively "Defendants") engaged in a fraudulent Ponzi scheme in which they.

8 solicited or caused to be solicited at least $13.5 milion from over 100 paricipants

9 in the United States and Canada to participate in commodity pools to trade

10 commodity futures and options1 including S&P 500 e-Minìs.

11 2. To induce paricipation in the pools operated by Driver, Axcess

12 Automation and Axcess Fund ManagemeNt, Driver told prospective paricipants

13 that he had successfully trded commodity futures and could obtain for them

14 retus of 10-20% per month.

15 3. Instead of trading all of the pool parcipants1 funds, Defendants only

16 traded a portion of the pool fuds, misappropriated some of them, and returned

17 some to pool paricipants as purorted profits1 in a maer typical of a Ponzi

18 scheme. The pool fuds that Defendants tråded were nearly all lost trading but

19 none of the trading losses were disclosed to pool parcipants.

20 4. To conceal the trading losses and the misappropriation, Defendats

21 issued or caused to be issued false periodic statements. These statements. falsely

22 reflected both highly.profitable retus from trading commodity futures on behalf

23 of the pool and that the pool was increasi~g iIi, value and assets.

24 5. In addition, from at least in or about Febru 2006 to in or about

25 September 2008 Defendant Driver, and from at least October 2007 though the

26 present Defendant Axcess Automation each acted as an unregistered commodity

27 pool operator.

28

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1 6. Defendant Axcess Fund Mangement also failed to produce books and

2 r~cords requested by the Commodity Futues Trading Commission ("Commission"

3 or "CFTC").

4 7. By virtue oftrns conduct and"the fuer conduct described herein,

5 Defendats have engaged, are engaging, and/or are about to engage in fraudulent

6 acts and practices tht violate the anti-fraud provisians ofSection4Q(l) of the

7 Commodity Exchange Act (the "Act"), 7 U.S.C. § 6Q(1) (2006), Sections

8 4b(a)(2)(i)-(iii) of the Act, 7 U.S.C. § 6b(a)(2)(i)-(iii) for conduct before June 18,

9 2008, and for acts on or after June 18,2008, Secton 4b(a)(1) of the Act, as

10 amended by the Food, Conservation, and Energy Act of 2008, Pub. L. No..1 i 0-

1 i 246, Title XIII (the CPTC Reauthorization Act ("CRA")), § 13102, 122 Stat. 1651

12 (effective June.18, 2008), to be codified at 7 U.S.C. § 6b(a)(I).

13 8. By failing to register with the Commission while actig as a

14 commodity pool operator, Defendants Driver and Axcess Automation violated

is Section 4m(l) of the Act, 7 U.S.C. § 6m(l). .

16 9. By virtue of the conduct described herein, Defendants Driver, Axcess

i 7 Automation and Axcess Fund Management commingled, are commingling, and are

18 about to commingle pool propert with non-pool property in violation of

19 Commi ssion Regulation ("Regulation") 4.20( c), 17 C.F .R. § 420( c) (2008).

20 10. By refusing to produce books and records requested by the

21 Cammission, Defendat Axcess Fund Management violated Secton 4n(3)(A) of

22 the Act, 7 U.S.C. § 6n(3)(A), and Regulations L.31(a) and 4.23, 17 C.P.R. §§

23 1.31(a) and 4.23.

24 11. As the controllng person ofAxcess Automation and Axcess Fund

25 Management, Defendat Driver is liable for their violations, puruat to Section

26 13(b) of the Act, 7 U.S.C. § 13c(b)7 beca~se he did not act in good fath or

27 knowingly induced, directly or indirectly, the acts constituting Axcess

28 Automation's and Axcess Fund Management's violations.

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1 12. Defendats Axcess Automation and Axcess Fund Management are

2 liable for Defendant Driver's violations pursuat to Section 2(a)(1)(B) of the Act, 7

3 U.S.C. § 2(a)(1)(B), because he was acting within the scope of his employment or

4 office with these entities.

5 13. Accordingly, the Commission brings this action puruat to Section 6c

6 öfthe Act, 7 U.S.C. § 13a-l, to enjoin Defendats' unlawful acts and practices and

7 to compel Defendants' compliance with the ACt and the Regulations. In addition,

8 the Commission seeks civil moneta penaties and remedial ancilar relief,

9 including, but not limited to, preliminar and permanent injunctions, trading and

10 registrtion bans, restitution, pre-judgment and post-judgment interest, and such

11 other relief as the Court may deem necessary and appropriate.

12 14. Unless restained and enjoined by the Court, Defendants are likely to

13 continue to engage in the act and practices alleged in this Complaint and in

14 similar acts and practices as more fully described below.

15 II. JUSDICTION AN VENUE

16 15. The Court has jursdiction over this action pursuat to Section 6c(a) of

17 the Act, 7 U.S.C. § 13a-l, which authorizes the Commission to seek injunctive

18 relief against any person whenever it shaH appear to the Commission that such

19 person has engaged, is engaging, or is about to engage in any act or practice

20 constituting a violation of the Act or any rule, regulation, or order thereunder.

. 21 16. Venue properly lies with the Cour puruat to Section 6c(e) of the

22 Act, 7 U.S.C. § 13a-l(e), in tht Defendants trsact business in this District, and

23 . acts and practices in violation of the Act have 'occured, are occuring~ or are about

24 to occur within this District.

25 III. THE PARTIES

26 17. Plaintiff U.S. Commodity Futures Trading Commission is an

27 independent federal regulatory agency chaged with the responsibility for

28 administering and enforcing the provisions of the Act 7 V.S.C. §§ I et seq.

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1 18. Defendant Gordon Al Driver is a resident of Las Vegas, Nevada and

2 has been registere with the Co~ssion as an Assciated Peron (" AP") of

3 Axcess Fund Management since SjPtember 2008 and is listed as its principal.

4 Driver is also the founder and owner ofAxcess Automation, and Axcess Fund.

5 Maagement. Prior to 2007, DrivJ was a resident of Oid, Caifornia.

6 19. Defendant Axcess A+omatiOn LLC is a Nevada limited liability

7 company with its principal place 0 business in Las Vegas, Nevada. Axcess

8 Automation has previously used m 'ling addresses in Niagar Falls, New York and

9 Mission Viejo, California. Axcess utomation has never been registered with the

10 Commission in any capacity. . . \

11 20. Defendant Axcess FUrd Management LLC is a Nevada limited

12 liabilty company with its pricipal 

I 

place of business in La Vegas, Nevada.

13 Axcess Fund Management has beef registered with the Corrission as a

14 Commodity Pool Operator ("CPO"~ since July 2008.. Axcess Fund Management

i

15 operates a commodity pool called Axcess Fund LP.

16

17

18

19

iv. FACTS

A.

21.

Axcess Automation

Section la(5) of the Act, 7 U.S.C. § 1a(5), defines a "commodity pool

20 operator" as any person engaged ina business tht is of the natue of an investent

21 trust, syndicate, or similar form of enterprise and in connection therewith, has

22 solicited, accepted or received fuds, secù'rti~s or propert from others for the

23 purose of trading in any commodity for future delivery on or sut)ject to the rules

24 of any contract maket or derivatives transaction' ex~cution facility.

25 22. From at least April 2006 though the present, Driver and Axcess

26 Automation solicited) or caused to be solicited, over 100 pool paricipants in

27 Canada and the United States for the purpose of trading in commodity futures on

28 or subject to the rules of a contract maket.

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1 23. Drivèr is the sole owner and principal of Ax cess Automation.

2 24~ Driver is in sole control overAxCßss Automation's commodity futues

3 and ban accounts.

4 25. Driver fasely told or caused to be told to pool pardpants that he had

5 proprietar trading software that he had used to sucèessfully trade commodity

. .

6 futures for himself, when, in fact, his personal trading trck record was

7 unsuccessfuL.

8 26. Driver promised paricipants that he could obtan profitable retus of

9 10-20% per month trding commodity futues on their behalf

10 27. Driver falsely or misleadingly told or caused to be told to prospective

11 Axcess Automation pool paricipants that by using his futures trading softare he

12 was able to obtain profits in seven or eight out often trdes, when, in fact, his

13 personal track record trding futures was E'redpminantly unprofitable.

14 28. The fuds tht Driver and Axcess Automation received from

15 paricipants were pooled into ban accounts in the name ofAxcess Automation.

16 Driver told or caused to be told to paricipants that their fuds would be pooled to

17 trade commodity futues.

18 29. Driver falsely told or caused to be toid to pool parcipants that he

19 would use all of their fuds to trade commodity futues. on their behalf when, in

20 fact, he only used a portion of the pool fuds to trade futues.

21 30. Several pool parcipants were recruted by Driver to solicit others and

22 to be point people in communicating with other pool participants.

23 31. The point people then solicited their friends and family to invest with

24 Axcess Automation and Driver. The information they provided their frends and . ... .

25 family about Axcess Automation and the investment came directly or indirectly

26 from Driver.

27

28

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1 32. Some of the point people who solicited their frends and family

2 received commissions from Driver and/or Axcess Automation. In some cases,

3 these commissions greatly exceeded their principal investment.

4 33. Over 100 people invested with Axcess Automation. At least 15 of the

5 Axcess Automation investors were from the United States.

6 34. Driver and Axcess Automation o~taned at least $13.5 millon from

7 pool parcipants.

8 35. Initially, Driver deposited pool parcip~ts' funds in a d//a bank

9 account at M&T Ban in Niagar Falls, New York in the name of Ax cess 

10 Automation. Driver has been using this account for his fraudulent scheme from at

11 least Apnl2006 though the present. Driver listed Niagara Falls, New York as the

12 mailing address for his d//a account at M&T Ban.

13 36. In October 2007, Driver organized Axcess Automation LLC in

14 . Nevada as a limited liability company.

15 37. From at least December 2007 through the present, Driver ha been

16 depositing pool paricipants' fuds in an Axcess Automation account at Citibank in

17 Las Vegas, Nevada. When Driver opene~ théCitiban account in the name of

18 Axcess Automation, he listed its mailing address as Mission Viejo, California.

19 38. Driver also accepted pool paricipant fuds in ban accounts in his

l

20 own name at HSBC Ban M&T Ban, and in one instace, his Citiban account in .

21 Canda.

22 39. Driver used at least $3 million of the pool paricipants' fuds to trade.

23 commodity futures in accounts at thee separate registered :ftues commission

24 merchants ("FCMs"). FCMs are individuas, associations, parerships,

25 corporations, and trsts that solicit or accept orders for the purchase or sale of any

26 commodity for future delivery on or subject to the rules of any exchange and that

27 accept payment from or extend credit to those whose orders are accepted. Driver

28 mostly traded S&P 500 e-Mini futures co~tracts on. the Chicago Mercantile

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1 Exchange's ("Clv") Globex electronic trading platform (hereinafter "Clv

2 Globex").

3 40. From at least Febru 2006 though May 2008, Driver controlled a

4 futues trading account in his own name at Transact Futes ("Trasact"), a

5 registered FCM.

6 41. Driver used pool partcipant funds to trde futues in his account at

7 Transact. Prom at least Febru 2006 though May 2008, Driver deposited

8 approximately $2.7 millon of pool paricipants' funds in his Traact account and

9 lost over $2.3 milion trading S&P 500 e-Mini futures on CME Globex. Driver

10 never had a profitable month in his Trasact account

11 42. Driver wired pool fuds from the Axcess Automation ban accounts

12 to his personal futures trading account at Transact. Driver falsely represented to

13 Transact that all of the fuds he was sending from the Axcess Automation bank

i 4 accounts were his own personal fuds. When Transact demanded that Driver

i 5 produce documentation verifying that all funds in Axcess Automation were solely

16 his personal funds, Driver closed his account at Transact in May 2008.

17 43. Prom at least August 2007 through March 2009, Driver controlled a

18 futures trading account in his own name at Dorman Trading LLC ("Dorman

19 Trading"), a registered FCM, which was used to trade commodity futures on behalf.

20 of the Axcess Automation pool paricipants. Driver deposited approximately

21 $640)000 of pool fuds in his Donnan Trading account and lost approximately

22 $629,000 trading commodity futues. Driver never had a profitable month in his

23 Dorman Trading account. Once again, Driver almost exclusively trded S&P 500

24 e-Mini futures on CME's Globex.

25 44. In March 2009, Driver opened a futures trading account at Advantage

26 Futures LLC, a registered FCM, in his own name,using approximately $50,000 of

27 pool fuds.

28

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1 45. During the Relevant Peiiod, Ðrìver sent, or caused others to send,

2 false periodic account statements to the Axcess Automation pool paricipants.

3 These periodic account statements falsely stated that pool paricipants were

4 receiving profitable retus of i Oto 20% per month. In fact, Driver had

5 unprofitable futures trading results nearly every month he was trading during the

6 Relevant Period.

7 46. In addition, Driver sent, or caused to be sent, statements to Axcess

8 Automation pool p~icipants that reported large account balances in their

9 accounts. For example, for the period ending Febru 2009, Driver sent

10 statements to one group ofAxcess Automation pool paricipants which showed

11 their cumulative accounts to be wort approximately $9,647,700. These report

12 were false because as of the end of Febri 2009, Axcess Autom~tion only had

13 approximately $63,000 in all of its ban and trading accounts.

14 47. The aforementioned accowit balance statements were also false in that

i 5 they showed consistently profitable returns nearly every week tht the investor was

16 a paricipant in the Axcess Automation pooL. In fact, the vat majority of Driver's

i 7 futures trading was consistently unprofitable.

18 48. On or about October 3, 2008, Driver sent at least one poolparìcipant

19 a false trading account statement from Dorman Trading purorting to show over

20 $34 million as of August 29,2008 in a Dorman Trading account in Driver's name.

21 This document was false. In fact, as of August 29,2008, Driver's actul balance at

22 his Donnan Trading account was less th $11,000.

23 49. Moreover, Driver and Axcesa Automation failed to disclose to pool

24 paricipants tht only a porton of their funds were actually being used to trade

25 futures.

26 50. Driver used some pool paricipants' funds to pay purported profits and

27 commissions to other pool paicipants and point people, respectîvely, in a iner

28 typical of a Ponzi scheme.

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1 51. In fact, the purorted profits tht Driver sent to pool paricipants were

2 . not actual profits but money obtained from other pool participants.

3 52. Driver misappropriated some of the pool's funds. For example, in or

4. about 2007 and 2008, Driver gambled at las. "egas casinos and withdrew pool

5 funds at one or more of these casinos.

6 53. Some pool paricipants decided to increase their paricipation on the

7 basis of alleged profits reported to those paricipants by Driver and Axcess

8 Automation.

9 54. Despite the fact that Driver and Axcess Automation combined had

10 over 100 pool paricipants and used the mails or instmentalities of interstate

11 commerce in their CPO business, they never registered as a CPO with the

12 Commission, nor did they ever obtain an exemption from CPO registrtion with

13 . the Commission.

14 55. On or about April 15, 2009, the CFTC subpoenaed documents from

15 Drver related to Axcess Automation, retupa~le on April 23, 2009.

16 56. On or about April 28, 2009, counsel for Driver informed the CFTC by

17 . letter that Driver "will be unable to produce tre and correct records evidencing

18 actual trading activity and corresponding financial records, an of which are

19 encompassed by the subpoena."

20 B. Axcess Fund Management

21 57. In June 2008, Driver applied to register Axcess Fund Maagement as

22 a CPO and to list himself as its pricipal, and to register himself as an AP of

23 Axces~ Fund Management.

24 58. Axcess Fund Maagement's registrtion as a CPO became effective'

25 on July 25, 2008.

26 59. Driver's registration as an ~ beqame effective on September.3, 2008. ) ,

27 60. Driver is the sole owner and principal ofAxcess Fund Mangement.

28

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1 61. After Driver registered Axcess Fund Management as a CPO, he began

2 to solicit the Axcess Automation pool paricipants to trsfer their accounts to

3 Axcess Fund LP, a commodity pool operated by Axcess Fund Management.

4 62. At leas 90% of the unregistered Axcess Automation pool paricipants

5 signed subscription agreements to join the Axcess Fund LP commodity pool.

6 63. Driver told, or caused to be told to, prospectve pool paricipants that

7 they could consider their account balances in :Axcess Automation, which were

8 false, in calculating their net wort to meet the minimum net wort requirements

9 for the Axcess Fund LP commodity pool.

10 64. In solicitig pool paricipants for the Axcess Fund LP pool, Dnver and

.11 Axcess Fund Mangement failed to disclose that Driver consistently lost money

12 trading futures.

13 65. In soliciting pool paricipants for the Axcess Fund LP pool, Driver and

14 Axcess Fund Management failed to disclose that profits reported to paricipants in

15 the Axcess Automation pool were false.

16 66. Driver sent, or caused to be sent, to prospective Axcess Fund LP pool

17 paricipants an email, dated Janua 20, 2009, in which they were told there were

18 only 100 spots in the pool and those spots, woi,ld be filling up soon. In ths email,

i 9 prospective pool paricipants were encouraged to act immediately and complete the

20. subscription agreement by Januar 30,2009. Prospective pol paricipants were

21 also told that "time is of the essence to giye yourelf the best possible opportunity

. 22 to secure your spot in the Axcess Fund. '"

23 67. On or about March 5, 2009, the Commission served a docwnent

24 request on Axcess Fund Mangement requestig books and records relating to the

25 pool and the CPO to be produced to. the Commission by March 12, 2009. Axcess

26 Fund Management failed to produce all requested books and records, such as the

27 investor subscription agreements.

28

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1 68. On or about April 9, 2009,' the Commission requested from Axcess

2 Fund Management by April 15,2009, a list of all p'ersons who received offering

3 documents for Axcess Fund LP. Axcess Fund Management never responded to the

4 Commission's request for this list.

5 V. VIOLATIONS OF THE COMMODITY EXCHANGE ACT 6 Count I

7 Violations o/Sections 4b(a) (2) (i)-(iii) o/the Act, and Sections 4b(a)(l)(A)-(C)

8 of the Act as amended by the eRA (Fraud and Misrepresentation)

9 69. The allegations set fort in pargraphs i though 69 are re-alleged and

10 incorporated herein by reference. i.

,

i 1 70. Sections 4b(a)(2)(i) through (iii) of th Act, 7 U.S.C. §§ 6b(a)(2)(i)-

i 2 (iii), make it Wllawful for any person to cheat or defraud or attempt to cheat or

13 defraud; wilfully make or cause to be made to such other person any false report

14 or statement thereof, or wilfully to enter or cause to be entered for such other

15 report any false record thereof; or willfully deceive or attempt to deceive by any

i 6 means whatsoever other persons in or in connection with orders to mae, or the

17 making of, contracts of sale of commodities, for future deliver, made, or to be

18 made, for or on behalf of such other persons where such contrcts for future

19 delivery were or may have been used for (a) hedging any transaction in interstate

20 commerce in such commodity, or the produce or byproducts thereof, or

21 (b) determining the price. basis of any transaction in interstate commerce in such

22 commodity, or (c) delivering any such coihm~dity sold, shipped'or received in

23 interstte commerce for the fulfillment thereof.

24 71. Sections 4b(a)(1)(A) though' (C) of the i Act as amended by the CRA,

25 to be codified at 7 U.S.C. §§ 6b(a)(1)(A)-(C), make it unlawful for any person, in

26 or in connection with any order to make, or the makng of, any contract of sale of

27 any commodity in interstate coinmerce or for future delivery that is made, or to be

28 made, on or subj ect to the rules of a designated contrct market, for or on behalf of

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1 any other person - (A) to cheat or defraud or attempt to cheat or defraud the other

2 person; (B) wilfully to make or cause to be made to the other person any false

3 report or statement or wilfully to enter or cause to be entered for the other person

4 any false record; or (C) wilfully to deceive or attempt to deceive the other person

5 by any means whatsoever in regard ,to any order or contract or the disposition or

6 execution of any order or contract, or in regard to any act of agency perfoffied,

7 with respect to any order or contrct for the other person.

8 72. As set fort above, in or in connection with futures contrct, made, or

9 to be made, for or on behalf of other persons, Defendants cheated or defruded or

i 0 attempted to cheat or defraud clients or prospective pool paricipants, willfully

i i made or caused to be made false reports, and wilfully deceived or attempted to

12 deceive clients or prospective clients by, among other things, soliciting funds fTom

. 13 investors for the purose of trding commodity futues by misrepresenting the

14 profit potential in trading futues using Driver)s proprieta trading softe and

i 5 failing to disclose that Driver had a losing trck record with respect to trading

16 futues.

17 73.. In additio~ as set fort above, Defendats sent or caused to be sent to

18 pool parcipants false report claiming large profits when, in fact, Defendats had

19 lost money trading commodity futures and misappropriated pool parcipants'

20 funds.

21 74. Driver sent at least one pool paricipant a false account statement from

22 Dorman Trading puiorting to show over $34 milion in Driver's account, when in

23 fact, Driver had less than $11,000 in that account.

24 75. Defendants engaged in the acts and practices described above

25 laowingly or with reckless disregard for the truth.

26 76. By this conduct before June 18,2008, Defendats violated Sections

27 4b(a)(2Xi)-(iii) of the Act, 7 U.S.C. § 6b(a)(2)(i~(iíí), and with respect to acts on

28

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1 or after June 18,2008, Sections 4b(a)(1)(A)-(C) of the Act as amended by the

2 CRA, to be codified at 7 U.S.C. § 6b(a)(l )(A)-(C).

3 77. Each misrepresentation or omission ofa material fact, including but

4 not limited to those specifically alleged herein, is alleged as a separate and distinct .

5 violation of Sections 4b(a)(2)(i)-(iii) of the Act, 7 U.S.C. § 6b(a)(2)(i)-(iii), with

6 respect to acts before June i 8, 2008, and with 'respect to acts on or after June i 8,

7 2008, Sections 4b(a)(1)(A)-(C) of the Act as amended by the CRA, to be codified

8 at 7 U.S.C. § 6b(a)(l)(A)-(C).

9 78. Puruat to Section 2(a)(I)(B) of the Act, 7 U.S.C. § 2(a)(1)(B), and

10 Regulation 1.2, 17 C.F.R. § 1.2, Axcess Automation and Axcess Fund

11 Management are liable for Driver's violations of the Act in that Driver acted within

12 the sèope of his employment or offce with Axcess Automation and Axcess Fund

13 Maagement.

i 4 79. During the Relevant Period, Driver controlled Axcess Automation and

15 Axcess Fund Management, directly or indirectly, and did not act in good faith or

I6 knowingly induced, directly or indirectly, Axcess Automation's and Axcess Fund

17 Management's acts constituting the violat¡ons'alleged in this Count. Therefore,

18 pursuat to Section 13(b) of the Act, 7 U.S.C. § 13c(b), Driver is liable for Axcess

19 Automation's and Axcess Fund Management's violations of Sectons 4b(a)(2)(i)-

20 (iü) of the Act, 7 U.S.C. § 6b(a)(2)(i)-(iii), with respe?t to acts before June 18,

21 2008, and with respect to acts on or afer June 18,2008, Sections 4b(a)(1)(A)-(C)

22 of the Act as amended by the CRA, to be codified at 7 U.S.C. § 6b(a)(I)(A)-(C).

23 Count II

24. Violations of Sect ions 4o(1)(A) and (B) of the Act (Fraud by CPO and AP of 25 CPO)

26 80. The allegations set fort in pargrphs 1 though 80 are re-alleged and

27 incorporated herein by refei:ence.

28

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1 81. During the Relevant Period, Defendants Driver, Axcess Automation,

2. and Axcess Fund Maagement acted as CPOs, and Driver also acted as an AP of

3 both Axcess Automation and Axcess Fund Management, and have used the mails

4 or other means of instrumentality of interstate commerce directly or indirectly a) .to

5 employ a scheme or arifice to defraud pool paricipants, or b) engaged in

6 transactions, practices or courses of business which operated as a fraud or deceit

7 upon pool participants, all in violation of Sections 40(1)(A) and (B) of the Act, 7

8 U.S.C. § 60(1)(A) and (B).

9 82. Each scheme or arfice to defraud .and each transaction, practice or

10 course of business which operated as a frud or deceit, including but not limited to

11 those specifically alleged herein, is alleged as a separate and distinct violation of

12 Sections 40(1)(A) and (B) of the Act~ 7 U.S.C. § 60(1)(A) and (B).

13 83. Pursuat to Section 2(a)(1)(B) of the Act, 7 U.S.C. § 2(a)(I)(B),and

14 Regulation 1.2, 17 C.F .R. § 1.2, Axcess Automation and Axcess Fund

15 Management are liable for Drver's violations of the Act in that Driver acted within

16 the scope of his employment or office with Axcess Automation and Axcess Fund

17 Management.

18 84. During the Relevant Period, Dnver controlled Axcess Automation and

19 Axcess Fund Mangement, directly or indirectly, and did not act in good faith or

20 knowingly induced, directly or indirect1y"AxcessAutomation's and Axcess Fund

21 Management's acts constitutig the violations alleged in ths Count. Therefore,

22 puruant to Section 13(b) of the Act, 7 U.S.C. § 13c(b), 'Driver is liable for Axcess

23 Automation's and Axcess Fund Management's violations of Sections 40(l)(A) and

24 (B) of the Act, 7 U.S.C. § 60(1)(A) and (B). 25 Count III

26 Violations of Section 4m(l) of the Act (Failure to Register as a CPO)

27 85. The allegations set fort in paragraphs 1 though 85 are re-alleged and

28 incorporated herein by reference.

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. i 86. During the Relevant Period, Drivér and Axcess Automation engaged

2 in a business that was of the nate of an investment trst, syndicate, or similar

3 form of enterprise, and, in connection therewith, solicited, accepted, or received

4 from others, funds, securties, or propert, either directly or indirectly or through

5 capita contributions, the sale of stock or other forms of securities~ or otherwise, for

6 the purpose of trading a commodity for future delivery on or subject to the rules of

7 any contract market or derivatives trsaction execution facility, thus making them

8 commodity pool operators as defined by Section 1a(S) of the Act, 7 U.S.C. § la(S).

9 87. During the Relevant Period, Driver and Axcess Automation were not

1.0 exempt from registrtion as a CPO under Regulation 4.13, 17 C.F.R. § 4.13.

11 88. During the Relevant Period, Driver and Axcess Automation each

12 made use of the mails or any means or instrmentality of interstate commerce in

13 connection with its business as a CPO, while failing to register with the

14 Commission as a CPO, in violation of Section 4m(1) of the Act, 7 U.S.C. § 6m(1).

,

15 89. . During the Relevant Period, Driver controlled Axcess Automation,

16 directly or indirectly, and did not act in good faith or knowingly induced, directly

17 or indirectly, Axcess Automation's acts constituting the violations alleged in this

18 Count. Therefore, pursuant to Section 13(b) of the Act~ 7 U.S.C. § 13c(b), Driver

19 is liable for Axcess Automation's violations of Secton 4m(l) of the Act, 7 U.S.C.

20 § 6m(1). 21 Countrv

22 Violations a/Regulation 4.20(c) (Commingling Pool Funds)

23 90. The allegations set fort in par~r.phs 1 though 90 are re-alleged and

24 incorprated herein by reference.

25 91. Regulation 4.20( c) prohibits CPOs from commingling pool propert

26 with non-pool propert.

27 92. Driver and Axcess Automation each commingled pool fuds with non28 pool property in bank accounts.

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i 93. Driver and Axcess Automation each commingled pool fuds with non2 pool property in futures trding accounts .

3 94. Axcess Fund Management accepted pool fuds in the name ofAxcess

4 Fund LP and commingled those fuds witl nan-pool property in ban accounts.

5 95. During the Relevant Period, Driver, Axcess Automation and Axcess

6 Fund Management commingled pool propert with non-pool propert in violation

7 of Regulation 4.20(c), 17 C.F.R. § 4.20(c).

8 96. Each instace or act of commingling of pool fuds with non-pool

9 property by Driver, Axcess Automation and Axcess Fund Management, including

10 but not limited to the acts alleged herein, is alleged as separate and distinct

I i violation of Regulation 4.20(0), 17 C.F.R. § 4.20(c).

12 97. During the Relevant Period, Driver controlled Axcess Automation and

13 Axcess Fund Management, directly or indirectly, and did.not act in good faith or

14 knowingly induced, directly or indirectly, Axcess Automation and Axcess Fund

15 Management's acts constituting the violat~onStalleged in this Count. Therefore,

16 pursuat to Section 13(b) of the Act, 7 U.S.C.§ 13c(b), Driver is liable for Axcess

17 Automation's and Axcess Fund Management's violations of Regulation 4.20(c), 17

18 C.F.R. § 4.20(c). 19 Count V

20 Violations o/Section 4n(3)(A).ofthe Act and Regulations 1.31(a) and 4.23

21 (Failure to Produce Books & Records)

22 98. The allegations set fort in pargraphs I through 98 are re-alleged and

23 incoiporated herein by reference.

24 99. Section 4n of the Act and Regulation 1.31(a)(I) require that every

25 registered CPO maintain books and records in such form and maner as may be

26 prescribed by the Commission. All such books and records shall be kept for a ~ r .

27 period of five years and shall be readily accessible during the first two years.

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1 Under Regulation 1.31 (a)(2), a copy of such ~ooks and records shall be provided to

2 a representative of the Commission upon the representative's request.

3 1 00. Re~lation 4.23 provides, in relevant par, that all registered CPOs

4 must make and keep, in accordance with Regulation 1.31, certin books and

5 records including, but not limited to, literature distrbuted to existing or prospective

6 paricipants in the pool and itemized records of commodity interest trsactions of

7 the pool.

8 101. Since July 2008, Axcess Fund Maagement ha been a registered

9 CPO.

10 102. On or about March 5,2009, the Commission served a request for

11 documents to Axcess Fund Management returnable on March 12, 2009, but the

12 company failed to produce all of the requested books and records, such as the

13 signed subscription agreements.

14 103. On or about April 9, 2009, the Conuission requested tht Axcess

15 Fund.Management produce by April 15, 2009, a list of all persons who received

16 offering documents for the Axcess Fund LP commodity pool. Axcess Fund

17 Management failed to comply with that request.

18 104. As set fort above~ Axcess Fund !yanagement failed to mantain " .

19 and/or produce books and records requested by the Commission in violation of

20 Section 4n(3)(A) of the Act 7 U.S.C. § 6n(3)(A), and Regulations 1.31(a) and

21 4.23~ 17 C.F.R. §§ 1.31(a) and 4.23.

22 105. During the Releyant Period, Driver controlled Axcess Fund

23 Management, directly or indirecty, and did not act in good faith or lmowingly

24 induced, directly or indirectly, Axcess Fund Management's act constituting the

25 violations alleged in this Count. Therefore, puruat to Section 13 (b) of the Act, 7

. 26 U.S.C. § 13c(b), Driver is liable for Axcèss Fund Management's violations of

27 Section 4n(3)(A) of the Act, 7U.S.C. § 6n(3)(A), and Reguations 1.3 1 (a) and .

28 4.23, 17C.F.R. §§ 1.31(a) and 4.23.

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1 V. RELIEF REQUESTED

2 . Wherefore, the Commssion respectfully requests that the Cour, as

3 authorized by Section 6c of the Act, 7 U.S.C. § 13a-l, and pursuant to its own

4 equitable powers, enter:

5 A. An order finding that Defendats violated Sections 4b( a)(2)(i)-(iii) of

6 the Act, 7 U.S.C. §§ 6b(a)(2)(i):-(iii), and Sections 4b(a)(1)(A)-(C) of the Act as

7 amended by the CRA, to be codified at 7 U.S.C. § 6b(a)(I)(A)-(C); .

8 . B. An order finding that Defendants Driver, Access Automation and

9 Axcess Fund Management violated Section 4Q(1) oftle Act, 7 U.S.C. § 6Q(1);

10 C. An order finding tht Defendants Driver and Axcess Automation .~ .,

11 violated Section 4m(1) of the Act, 7 U.S.C. § 6m(l);

12 D. An order finding that Defendants Driver, Axcess Automation and

13 Axcess Fund Management violated Regulation 4.20(c), 17 C.F.R. § 4.20(c);

14 E. An order finding that Defendant Axcess Fund Management violated

15 Section 4n(3)(A) of the Act, 7 U.S.C. § 6n(3)(A), and Regulations 1.31 (a) and

16 4.23, 17 C.F.R. §§ 1.31(a) and 4.23;

17 F. An order ofprelillna and permanent injunction prohibiting

18 Defendants and any of their agents, servants, employees, assigns, attorneys, and

19 persons in active concert or paricipation with any Defendants, including any

20 successor thereof, from engaging, directly or indirectly, in any violation of

21 Sections 4b(a)(1)(A)-(C) of the Act as aiend~d by the CRA, to be codified at 7 , '

22 U.S.C. § 6b(a)(1)(A)-(C), Section 4Q(1) of the Act, 7 U.S.C. § 6Q(1), and

23 Regulation 4.20( c), i 7 C.F.R. § 4.20( c);

24 G. An order of preliminar and pennnent injuncton prohibiting

25 Defendats Driver and Axcess An.tomation and any oftheii agents, servants,

26 employees, assigns, attorneys, and persons' in active concert or paricipation with

27 Defendants Driver and Axcess Automation~ including any successor thereof, from

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1 engaging, directly or indirectly, in any violation of Section 4m(l) of the Act; 7

2 U.S.C. §§ 6m(1);

3 H. An order of preliminar and peranent injunction prohibiting

4 Defendants Axcess Fund Management and Driver and any of their agents, servts,

5 employees, assigns, attrneys, and persons in active! concert or parcipation with

6 Defendats Axcess Fund Management and Driver, including any successor thereof,

7 from engaging, directly or indirectly, in any violation of . . Section 4n(3)(A) of the

. 8 Act, 7 U.S.C. §§ 6n(3)(A), and Regulations 1.31(a) and 4.23, 17 C.F.R. §§ 1.31(a)

9 and 4.23;

10 1. An order ofpreliminar and perment injunction prohibitig

11 Defendants and any of their agents, servants, employees, assigns, attorneys, and.

12 persons in active concert or paricipation with any Defendants, including any

i 3 successor thereof, from:

14 I) Trading on or subject to the rules of any registered entity, as

15 that term is defined in Section 1a(29) of the Act, 7 U.S.C. § 16 la(29);

17 2) Engaging in, ~ontrollng or directing the trading for any

18 commodity interest account for or on behalf of any other person

19 or entity, whether by power of attorney or otherwse;

20 3) Solicitig or accepting fuds from any person in connection

21 with the purchase or sale of any commodity interest;

22 4) Applying for registration or claiming exemption from

23 registration with the Commission in any capacity, and engaging

24 in any activity requiring such registration or exemption from

25 registration with the Cbmmission, except as provided for in

26 Regulation 4. 14(a)(9), 17 C.F.R. § 4. 14(a)(9),or acting as

27 principal~ agent or any other off?er or employee of any person

28 register~d, exempted from registration or required to be

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1 registered with the Commission, except as provided for in

2 Regulation 4.14(a)(9), 17 C.F.R. § 4.14(a)(9);

3 5) Entenng into any commodity interest transactions for their own

4 personal accounts, for any account in. which they hav~ a direct

5 or indirect interest andlor having any commodity interests

6 traded on their behalf; and! or

7 6) Engaging in any business activities related to commodity

8 interest tqding;

9 J. Enter an order directing each Defendant to pay a civil moneta

10 penalty in an amount provided pursuant to Section 6c(d)(I) of the Act, 7 U.S.C. §

1 i 13a-1 (2006), and Regulation 143.8, 17 C.F.R. § 143.8 (2008), for each violation

12 of the Act or Regulations, plus post-judgment interest;

13 K. Enter an order providing for such other and fuer equitable and

14 ancillar relief as this Cour may deem necessa and appropriate, including but

15 not limited to restitution and disgorgement and interest thereon from the date of

16 such violations; and ì

17 L. Enter an order requinng Defendats to pay costs and fees as permitted

18 by 28 U.S.C. § 1920 and 2412(a)(2).

19 M. Such other and fuer relief as the Court deems proper.

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Dated: May 13, 2009

New York) New York

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Respectfully submitted,

ATTORNYS FOR PLAINIFF

U.S. COMMODITY FUTURS

TRING COMMISSION

Lenel Hickson, Jr.

Acting Regional Counsel

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By: W~q

Michael R. Berlowitz

W. Derek Shakabpa

David Acevedo

140 Broadway, 19th Floor

New York, N.Y. 10005

(646) 746-9754 (Acevedo)

(646) 746-9940 (facsimile)

dacevedo(§cftc.gov

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1 DEMAD FOR JURY TIDL

2 Pursuant to Local Rule 3 8~ 1, Plaintiff respectfully requests a jury triaL.

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4. Respectfully submitted,

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6 Dated: May 13, 2009

New York, New York

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A TTORNYS FOR PLAl~F

u.s. COM:ODITY FUTURS

lRING COM1VUSSION

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Lenel Hickson, Jr.

A-cting Regional Counsel

By: ~ Rii--

Michael R. Berlowitz

W. Derek Shakabpa

David Acevedo

140 Broadway, 19th Floor

New York, N.Y. 10005

(646) 746-9754 (Acevedo)

(646) 746-9940 (facsinle)

dacevedo§cftc.gov

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