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At 04:35 PM 10/26/98 -0500, Paul Weston wrote:
>I sent an email to Cox requesting more information and said that I was
>somewhat disturbed by the information that he was investigated by the CFTC.
> I asked him if it were true and if so, what was the outcome. I have heard
>nothing.
>
>Regards,
>Paul Weston
OK,
Thought I had covered this before. The CFTC became interested in the
Bullseye Indicators in 1996 because I was using various forums on the
Internet to promote the use and sale of the methodology. This was all very
new back then, and agencies like the CFTC and the SEC were actively
searching out fraudulant and unlawful uses of the Internet or fraudulant
practices that were promoted on the Internet.
Frankly speaking, they were looking to make examples of "fraud" so as to
assert their control of this new technology (the Internet). Bullseye was
very well known in 1996 so I became the subject of an investigation
(although they had received no complaints). I was an easy target.
Although I gladly cooperated with them through early 1997...in fact,
demonstrated the Indicators to a CFTC attorney during a typical trading day
right here in my home...they continued to press and issued a far-ranging
subpoena that would have basically opened my entire business and personal
life to these investigators. If you think an IRS audit is something, the
CFTC subpoena was 10 times as far-reaching as any IRS investigation you can
imagine.
Again, although I was cooperating, I drew the line at providing my bank
records for the past ten years. I also refused to supply them with a
complete customer list since I actually didn't have one due to a computer
problem. At that time approximately 35-40 traders had purchased the
indicators and methodology. I provided the CFTC with about 20 names and
addresses...the traders who stayed in touch with me and the ones I was
currently training.
One governemnt attoney in the enforcement division was not satisfied eith
this so he filed an action in US District Court in Washington, DC to
compell me to do whatever he wanted (again, they had not received any
complaints)(this was strictly a "fishing expedition")). Since I really
didn't have the funds to hire a DC attorney to fight this and I didn't have
anything to hide (I was against their far-reaching investigation since even
the police can't do what they were doing without probable cause) the DC
judge issued an order for me to fully comply. The CFTC public relations
department jumped on this and issued a press release touting their victory.
They still hadn't received a complaint nor had they discovered anything
wrong. So they went through all my bank records and contacted some clients
who had purchased the indicators since the investigation had begun. They
also requested and received the Indicators and underlying code along with
the methodology and subsequently installed them on a TradeStation in
Washington.
I was also the subject of three hour sworn deposition conducted by two
CFTC attorneys. Unlike some other people in Washington, I provided truthful
and accurate answers to their queries.
The investigation concluded in September 1997. No civil or criminal
charges were filed, no action was taken, and the matter officially closed.
I answered this email from Paul Weston because I do not want people to get
the wrong impression or think I was disciplined by the CFTC.
Out of the 70 or so indivduals who purchased the $495 Indicators, seven
asked for a refund. Five traders received a full refund. Two did not. I had
my reasons. (By the way, out of the 70 or so traders who purchased
Bullseye, over 40 have come to Las Vegas and traded with me in my home.)
I suppose I'll get flamed just for defending myself. Most of the people
who flamed me two weeks ago don't know me, have not seen the indicators or
understand the methodolgy. Such is life on the Internet.
I work as a fulltime professional futures trader, although I do take on a
few students from time to time. I found out that I enjoy working with
traders and helping to contribute towards their hoped-for success. I also
make new friends by teaching and trading can be a bit lonely sometimes.
Nothing sinister here folks...sorry.
Jim Cox
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