| COMPLAINT -
ON DECEMBER 14, 1995, NFA'S BUSINESS CONDUCT COMMITTEE ("COMMITTEE") ISSUED A COMPLAINT TO SCOTT D. WOLFE CTA, INC. ("SDW") AND SCOTT D. WOLFE ("WOLFE"). THE COMPLAINT ALLEGES THAT SDW AND WOLFE USED PROMOTIONAL MATERIAL WHICH WAS DECEPTIVE AND MISLEADING, IN VIOLATION OF NFA COMPLIANCE RULES 2-29 (b)(1) AND 2-29 (b)(2). THE COMPLAINT ALSO ALLEGES THAT SDW AND WOLFE USED PROMOTIONAL MATERIAL WHICH MENTIONED THE POSSIBILITY OF PROFITS WITHOUT AN EQUALLY PROMINENT STATEMENT OF THE RISK OF LOSS, AND SUCH PROMOTIONAL MATERIAL INCLUDED HYPOTHETICAL RESULTS WITHOUT BEING ACCOMPANIED BY THE REQUIRED CFTC DISCLAIMER REGARDING HYPOTHETICAL RESULTS, IN VIOLATION OF NFA COMPLIANCE RULES 2-29(B)(3) AND 2-29(B)(4). FURTHERMORE, THE COMPLAINT ALLEGES THAT SDW AND WOLFE USED PROMOTIONAL MATERIAL WHICH INCLUDED A REFERENCE TO ACTUAL PAST TRADING PROFITS WITHOUT MENTIONING THAT PAST PROFITS ARE NOT NECESSARILY INDICATIVE OF FUTURE RESULTS, IN VIOLATION OF NFA COMPLIANCE RULE 2-29(b)(5).
ANSWER -
ON JANUARY 17, 1996, SDW & WOLFE FILED AN ANSWER TO THE COMPLAINT IN WHICH THEY DENIED THE MATERIAL ALLEGATIONS CONTAINED THEREIN. SDW AND WOLFE REQUESTED A HEARING BEFORE NFA'S HEARING COMMITTEE.
DECISION - SCOTT D. WOLFE CTA, INC. AND SCOTT D. WOLFE
ON APRIL 3, 1996, NFA'S BCC ISSUED A DECISION ACCEPTING THE SETTLEMENT OFFER OF SDW AND WOLFE. THE BCC ORDERED SDW TO PERMANENTLY WITHDRAW FROM NFA MEMBERSHIP. THE BCC ORDERED WOLFE TO WITHDRAW AS AN NFA ASSOCIATE AND NOT REAPPPLY FOR NFA MEMBERSHIP OR ASSOCIATE MEMBERSHIP FOR A PERIOD OF TEN YEARS FROM THE DATE OF THIS DECISION AND, DURING SUCH TIME, NOT ACT IN ANY CAPACITY REQUIRING NFA MEMBERSHIP OR ASSOCIATE MEMBERSHIP OR ACT AS A PRINCIPAL OF AN NFA MEMBER. THIS DECISION BECOMES EFFECTIVE APRIL 18, 1996. |