National Futures Association (NFA) announced today that it has taken an emergency enforcement action against D2W Capital Management LLC (D2W), Prestige Capital Advisors LLC (Prestige) and its principal, Toby Hunter. D2W and Prestige are Commodity Trading Advisors located in Charlotte, North Carolina.
Based on NFA’s examination of D2W and Prestige, it appears that D2W, Prestige and Hunter have misled customers regarding the value of their investments, continue to solicit potential customers with false and misleading performance information and have not provided D2W’s customers with an NFA approved disclosure document. D2W, Prestige and Hunter have not been able to provide current books and records to NFA supporting the current value or location of their purported assets and client funds, and have also misled NFA throughout its investigation of the firms.
NFA’s MRA document contains the following paragraph which goes to show you how these funds were operating:
(Per NFA’s request) Hunter also produced some bank records for both Prestige and the Prestige Fund. NFA reviewed the Prestige bank records and the Prestige trading account records and noticed several very large withdrawals from the Prestige Fund’s trading accounts to Prestige. For example, on December 15, 2010 and December 16, 2010, investors wired almost $4 million to a Prestige Fund brokerage account. On December 16, 2010, $300,000 was wired from the Prestige Fund’s brokerage account to Prestige’s bank account and on December 22, 2010 an additional $105,000 was also wired from the Fund’s brokerage account to Prestige’s bank account. When NFA asked Hunter why Prestige withdrew approximately $400,000 from the Fund’s brokerage account, Hunter said he would have to “look into it and get back to NFA.” Hunter never explained these transactions to NFA nor provided any documentation to support the transactions.
Effective immediately, the Member Responsibility Action (MRA) and Associate Responsibility Action (ARA) prohibits D2W, Prestige and Hunter from soliciting or accepting any funds from customers or investors, soliciting investments for any managed accounts, pools or other investment vehicles, or placing any trades. D2W, Prestige and Hunter are also prohibited from disbursing or transferring any funds of customers, investors or pools over which they exercise control, or participants in any such pools, without prior approval from NFA.
Legal Risk Factor Beneath Ripple’s Lawsuit from SECGo to article >>
The MRA/ARA will remain in effect until such time that D2W, Prestige and Hunter demonstrate that they are in complete compliance with all NFA Requirements. D2W, Prestige and Hunter may request a prompt hearing before NFA’s Hearing Committee.
The complete text of the MRA/ARA can be found on NFA’s website (www.nfa.futures.org).
The following Compliance staff members are responsible for this case: LeeAnn Reider (312-781-1553) and Chris Mitseff (312-781-1477).
NFA is the premier independent provider of innovative and efficient regulatory programs that safeguard the integrity of the futures markets.