Release:#3925-96

For Release:July 16, 1996

CFTC FILES NINE-COUNT COMPLAINT AND OBTAINS PRELIMINARY INJUNCTION
    AGAINST EDWARD W. SCHROEDER, THE EDWARD W. SCHROEDER LIVING TRUST, AND
    ANDRE D. FITE OF SANTA MONICA AND LOS ANGELES, CALIFORNIA

Defendants Are Charged with Defrauding More than 40 Commodity
    Pool

Customers of an Amount in Excess of $3 Million

WASHINGTON -- The Commodity Futures Trading Commission (CFTC) announced
    today that on July 11, 1996, U.S. District Court Judge Harry L. Hupp of the
    Central District of California in Los Angeles entered a preliminary
    injunction against Edward W. Schroeder, the Edward W. Schroeder
    Living Trust -- both of Santa Monica, California, and Andre D.
    Fite of Los Angeles, California. None of the defendants has ever been
    registered with the CFTC in any capacity.

The court's preliminary injunctive order stems from a nine- count civil
    injunctive complaint filed by the CFTC on July 1, 1996, alleging, among
    other things, that defendants violated the anti- fraud provisions of the
    Commodity Exchange Act (CEA) by cheating and defrauding customers.
    In addition, Schroeder and the Schroeder Trust are alleged to have
    converted customer funds to personal use in connection with acting as
    unregistered commodity pool operators. The complaint states that since at
    least June 1990, Schroeder has solicited members of the public, by mail,
    telephone and other means of interstate commerce, to participate in a
    commodity pool, and that in August 1994, he created the Edward W. Schroeder
    Living Trust.

Specifically, the CFTC complaint alleges that Schroeder, both
    individually and as Trustee of the Schroeder Trust, through
    misrepresentations and false statements, obtained and converted in excess
    of $3 million from approximately 40 customers, while acting illegally as a
    commodity pool operator. According to the complaint, "Schroeder treated
    pool funds as his own property, using them to pay his personal expenses and
    to make deposits into his personal bank accounts."

The complaint further alleges that Schroeder and the Schroeder Trust
    received investor funds in a name other than that of the pool's, commingled
    pool property with assets of other persons, and that Fite acted as an
    unregistered associated person of the commodity pool.

Finally, the complaint alleges that the defendants advertised the pool
    in a fraudulent or deceptive manner and failed to provide required
    disclosure documents to customers. According to the complaint, Schroeder
    suffered over $1 million in commodities trading losses while assuring
    customers that he was earning high profits. Schroeder and Fite, for
    example, told some pool participants that the pool had a 62-month unbroken
    string of profits, that their investments would be without risk, and that
    the pool guaranteed rates of return between 18 and 36 percent annually,
    paid monthly.

On the same day the complaint was filed, the court granted the CFTC an
    ex parte restraining order, which freezes the defendants'
    assets, including accounts in which investors' funds were alleged to have
    been deposited, and prohibits the destruction of the defendants' books and
    records. Subsequently, on July 2, 1996, the court issued a temporary
    restraining order, which continued the asset freeze and prohibited further
    violations of the CEA as charged in the complaint.

Preliminary Injunction Continues Ex Parte Freeze of
    Defendants' Assets and Requires that Schroeder Make an Accounting of
    Customers' Funds with the Court

The preliminary injunction 1) continues the asset freeze, 2) enjoins the
    defendants from violating provisions of the CEA requiring registration for
    commodity pool operators and prohibiting fraud and misappropriation of
    customers' funds, 3) enjoins the defendants from further soliciting
    customers or accounts, and 4) orders defendant Schroeder to file an
    accounting of customer funds with the court within 30 days.

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