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1 August 2000

News Release

NEW ZEALANDERS CAUGHT IN US FUTURES FRAUD

The United States Commodity Futures Trading Commission (CFTC) has taken court action against a scheme involving the fraudulent marketing of illegal futures contracts.

Subject to the action are Alan Stein, Joseph Finateri and Michael Temple together with related corporations IBS Inc, IMC Trading Inc, Joe Miller Company and Mazuma Trading Group Inc.

The illegal futures contracts were for precious metals and other commodities. Customers were solicited by telephone (both within and outside the United States). At least 35 people living in New Zealand have committed money to the scheme.

The CFTC considers that the telemarketers misrepresented the likely profits to be made and failed to disclose the risk of near-certain losses.

We are informed that virtually all customers have lost most of the money they invested. Much of the money has gone on commissions and fees which were not disclosed to customers when they entered into the arrangements.

The contracts themselves were illegal under United States regulatory requirements. There is no evidence that the promoters complied with New Zealand law.

The scheme promoters purported to operate from the Bahamas but were actually based in Charlotte in North Carolina.

Stein, Finateri and Temple are the three principals behind the scheme.

People who have committed money to this scheme may wish to contact Jacqueline Hamra at the CFTC. The phone number is 1 202 418 5386. The fax number is 1 202 418 5523.

The case shows how important it is for people to be very cautious when approached with overseas investment propositions over the telephone.

The proposition may sound extremely attractive but the reality may be quite different. There is a good chance that you will lose your money.

Norman F Miller
Senior Executive (Operations)

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