Company, National Equities Holdings, Inc. with $1.4 Million Commodity Pool Fraud

November 16, 2011

Company, National Equities Holdings, Inc. with $1.4 Million Commodity Pool Fraud

CFTC Charges California Residents Robert Cannone, Thomas Breen, and Francis Franco and Their Company, National Equities Holdings, Inc. with $1.4 Million Commodity Pool Fraud

The defendants charged with fraudulent solicitation, misappropriation of customer funds, and false statements

Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced the filing of a complaint in federal court in Santa Ana, Calif., charging defendants Robert J. Cannone of Laguna Niguel, Thomas B. Breen of San Juan Capistrano, Francis Franco of Anaheim, and their company National Equity Holdings, Inc. of Laguna Niguel, with fraudulently operating a $1.4 million commodity futures pool and with registration violations.

The CFTC complaint, filed in the U.S. District Court for the Central District of California, alleges that from at least May 2009 through at least May 2010, the defendants fraudulently solicited and accepted at least $1.4 million from 20 or more individuals to trade commodity futures contracts by participating in a commodity pool called NEH.

The defendants traded only a portion of the pool participant funds in proprietary accounts, sustaining overall and significant losses of approximately $582,631, according to the complaint. Defendants also allegedly misappropriated the majority of the pool participants’ funds to make so-called returns to participants in monthly payments that defendants claimed were the profitable proceeds of their trading.

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