Release: 4308-99 (3:99CV592)

For Release: August 26, 1999

VIRGINIA COURT ENTERS DOCUMENT AND ASSET FREEZE IN CFTC INJUNCTIVE
    ACTION AGAINST PETER BERZINS CHARGING COMMODITY POOL FRAUD

CFTC Alleges Berzins Defrauded Investors By Making Misrepresentations
    While Soliciting Funds And Operating a Commodity Pool

WASHINGTON � The Commodity Futures Trading Commission (CFTC)
    announced today that the Honorable Robert E. Payne of the U.S. District
    Court for the Eastern District of Virginia entered a statutory
    restraining order against Peter Berzins of Houston, Texas,
    prohibiting Berzins from altering or destroying books, records and
    documents, and transferring, encumbering, or dissipating his assets, in a
    CFTC injunctive action charging Berzins with fraudulently operating a
    commodity pool.

The orders arise out of an injunctive complaint filed by the CFTC on
    August 24, 1999, alleging that, since at least 1996, Berzins has violated
    anti-fraud provisions of the Commodity Exchange Act (CEA) (sections 4b(a),
    4c(b) and 4o(1)) and CFTC regulations (section 33.10) by
    fraudulently soliciting and accepting from investors in excess of $500,000
    to participate in a commodity pool to trade commodity futures contracts and
    options on futures contracts.

Specifically, the complaint alleges that, in order to induce additional
    investments, Berzins misrepresented to prospective investors the
    performance record of the pool he had been trading and provided investors
    with written statements which falsely represented that investors were
    making significant monthly profits. The complaint further alleges that
    Berzins continuously represented to investors that their investments were
    earning double-digit returns, when, in fact, Berzins' trading accounts
    all lost money in 1995, 1996, 1997 and 1998. The complaint alleges that
    Berzins minimized the risk of investing in the commodity pool when
    soliciting investors.

According to the complaint, in March 1998, Berzins represented to
    investors that their investments, and the profits purportedly earned
    earlier, had been lost in trading the previous month, and provided one or
    more investors with falsified documents, reflecting a purported margin call
    from a futures commission merchant to support the claim of recent large
    trading losses. As alleged, no such margin call was ever made.

The complaint also alleges that Berzins failed to register as a
    commodity pool operator, failed to provide investors with periodic account
    statements, commingled investor funds with his own funds, failed to operate
    the commodity pool as an entity separate from himself, and accepted trading
    funds in his own name, all in violation of the CEA (sections 4m and 4n) and
    CFTC regulations (sections 4.20, 4.21 and 4.22).

In its continuing litigation, the CFTC is seeking a preliminary
    injunction, civil money penalties and other remedial relief, including
    restitution to investors. The CFTC's action against Peter Berzins arose
    from a referral by the State Securities Board of the State of Texas.

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