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Fridge Ploy Not Cool with Grand Jury

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CHARLOTTE, N.C. (–A federal grand jury has indicted a husband and wife in charges arising out of the Commodity Futures Trading Commission’s lawsuit filed against Tech Traders LLC two years ago.

The grand jury, at the behest of Gretchen C.F. Shappert, U.S. attorney for the Western District of North Carolina, charged Howell and Vernice Woltz, of Advance, N.C., with a variety of criminal acts that were intended to derail that lawsuit.

The indictment, filed April 4, explains for example that Ms. Woltz sought to evade service of a subpoena from the CFTC. When a process server arrived at her home to deliver it, she “ran from the process server and hid behind the refrigerator….” the indictment states. Ten days later, she ran into her residence when she again saw a process server approach. All told, her avoidance cost the CFTC over $1,000, the indictment states.

Mr. Woltz, upon whom a subpoena had been served, consequently appeared in Charlotte, N.C. on Dec. 10, 2004, and “gave false and misleading answers to questions posed to him.”

On April 21, 2006, the CFTC released a statement congratulating the authorities in North Carolina on this indictment.

Behind the obstruction charges is the substantive lawsuit that led to the subpoenas. That lawsuit came about because the Woltzes were involved in a group of “purported off-shore entities” known as the Stirling Group, which raised funds for Tech Traders, a commodity trading adviser, and Shasta Capital Associates LLC, a hedge fund.

The CFTC alleged that Tech Traders solicited millions of dollars from investors on the fraudulent claim that it, and Shasta, employed a “unique computerized approach” that would generate returns of “over 100% per year.”

In addition to the refrigerator incident and Mr. Woltz’ alleged perjury, the indictment alleges that Vernice Woltz removed documents and a computer tape from the home of Tech Trader’s accountant after the CFTC’s action was filed.

In its release of congratulations, the CFTC said that an equity receiver appointed by the court in its lawsuit has frozen numerous assets of Tech Traders, and has returned nearly $3 million to parties who invested via the Sterling group.

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Contact Bob Keane with questions or comments at [email protected].