Allegedly Sold Metals It Didn’t Own : Encinitas Firm Charged With Fraud
An Encinitas company that allegedly sold precious metals it didn’t own to hundreds of investors has been charged with fraud and violations of the federal Commodity Exchange Act.
James Timpson & Associates Inc. and its owner, James Timpson, were accused by the Commodities Futures Trading Commission of selling commodities futures contracts that weren’t registered with regulators.
According to documents unsealed in federal court Thursday, the firm promised investors “substantial profits” in a short period of time when, “in fact . . . customers seldom, if ever, earn a profitable return . . . and frequently lost part or all of their original investment.”
U.S. District Judge Howard Turrentine issued a temporary restraining order prohibiting the firm and Timpson from destroying, removing or altering its books and records. Turrentine also froze funds in at least two bank accounts belonging to the firm.
Timpson & Associates’ office is now empty, according to the documents.
On Tuesday, the leasing agent at Timpson & Associates’ building told FBI officials that several people had been seen removing furniture and “trash sacks full of unknown materials” from Timpson’s offices.
The materials were then loaded into trucks, according to the documents.
It remains uncertain how much money Timpson & Associates attracted because the company “wasn’t maintaining books and records,” according to Arthur J. Salzberg, regional counsel for the commission. He said the firm lured about 350 investors from Southern California and in several other states.
Salzberg has asked for a court-appointed receiver to take over the company. A hearing on the commission’s request is scheduled for Wednesday.