Release:#3993-97 (94-C4375)

For Release: February 21, 1997

PERMANENT INJUNCTION ENTERED AGAINST EDWARD M. COLLINS OF HOFFMAN
    ESTATES, ILLINOIS, IN CFTC ANTI-FRAUD ACTION FILED IN 1994

Court Says Defendants in the Case Operated an Unregistered Commodity
    Pool in a Manner Akin to a Ponzi Scheme, Among other Violations of Federal
    Commodity Law

WASHINGTON -- The Commodity Futures Trading Commission (CFTC) announced
    today that Judge Joan B. Gottschall of the U.S. District Court for Northern
    Illinois entered an order of permanent injunction against Edward M.
    Collins of Hoffman Estates, Illinois, a defendant in a six-count civil
    anti-fraud action filed on July 19, 1994 (See CFTC News Release #3777-94).
    Thomas Collins of Palatine, Illinois, Edward's brother who is now deceased,
    and Lake States Commodities, Inc. of Rolling Meadows, Illinois, were also
    named in the CFTC complaint.

The complaint alleged that from at least January 1989 to June 1994, the
    defendants cheated and defrauded investors and committed commodity pool
    fraud by, among other things, misrepresenting to commodity pool investors
    that their funds were invested in a multi-million dollar commodity pool,
    when, in fact, such an account did not exist; issuing statements which
    falsely reported that investors' accounts were increasing in value as a
    result of gains in the commodity pool trading account; misrepresenting that
    investors could expect 30 to 50 percent annual returns on their investment
    when there was no reasonable basis for such representations; and advising
    investors that their investment relationship was to be construed as a
    personal loan to Thomas Collins, with no statements issued that could link
    the customers to the futures market.

Thomas Collins, who was president of Lake States Commodities, fled his
    Illinois residence in June 1994. His whereabouts were unknown until July
    22, 1996, when he died in San Diego, California. Edward Collins was the
    secretary and a shareholder of Lake States Commodities. Neither Edward
    Collins nor Lake States Commodities has ever been registered with the CFTC;
    Thomas Collins had been registered as a floor trader since February 1994,
    and had been a member of the MidAmerica Commodity Exchange since 1985.

Court Finds that Edward Collins Violated Federal Commodity
    Law

The court's permanent injunctive order against Edward Collins finds that
    Edward Collins violated anti-fraud and registration provisions of the
    Commodity Exchange Act, as charged in the complaint, and enjoins him from
    further such violations of Federal commodity law.

According to the court's order, "The evidence indicates that on repeated
    occasions, [the] defendant made misrepresentations to investors and
    potential investors, issued false reports and statements, and solicited
    funds for a fraudulent scheme. Defendant's fraudulent activities continued
    in modified form even after the commencement of the CFTC's
    investigation."

Edward Collins Also Is a Respondent in an Ongoing CFTC Administrative
    Action

On May 19, 1994, the CFTC filed an administrative enforcement action
    against Edward and Thomas Collins, alleging, among other things, that they
    engaged in fictitious sales and noncompetitive trades in violation of the
    CEA (CFTC Docket No. 94-13, CFTC News Release #3765-94). That matter is
    pending before CFTC Administrative Law Judge Bruce C. Levine.

On June 21, 1994, involuntary bankruptcy actions were filed against
    Thomas Collins and the defunct Lake States. The bankruptcy trustee has
    brought adverse actions against Edward Collins and others to recover funds
    on behalf of investors and other creditors. A number of these adverse
    actions are pending.

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