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January 24, 2007
National Futures Association takes emergency enforcement action against New York commodity pool operator and its principal
January 24, Chicago - National Futures Association (NFA) announced today that it has suspended Cornerstone Capital Management LLC (CCM), a commodity pool operator and commodity trading advisor located in New York City, and Joseph Thomas Profit, Jr., the firm's principal. As a result of the suspension, CCM and Profit are prohibited from acting in any manner which requires registration under the Commodity Exchange Act and are prohibited from soliciting or disbursing any funds without NFA approval.
NFA took the enforcement action, which becomes effective immediately, because CCM and Profit have operated a commodity pool (the Cornerstone Icon Fund LP) without being properly registered under the Commodity Exchange Act. NFA also charges that CCM and Profit provided false and misleading information to NFA and refused to cooperate in an NFA inquiry.
Although CCM has been registered as a CPO and CTA since August 2005, Profit continually claimed that the Icon Fund had not accepted funds from participants or begun trading. Profit has also claimed that CCM did not have any funds under management. During the course of NFA's investigation, however, Profit admitted accepting funds from participants in the Icon Fund in May 2005 and that Profit has had CTA clients.
The suspension will remain in effect until NFA is satisfied that CCM and Profit are in complete compliance with all NFA requirements. CCM and Profit may petition the CFTC for a stay of this action and may also request a hearing before NFA's Hearing Committee.
The complete text of the Member Responsibility Action is available on NFA's Web site (www.nfa.futures.org).
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