posted 04-02-2008 02:10 AM                  

i'm a trader, have been for over 10 years. earlier this month the llc firm i trade with (tuco trading) was shutdown by court order due to allegations by the sec that our class A firm members were defrauding us. they weren't.

it was a pooled money firm. the class A memebers were paid a commission on trades in exchange for providing financial backing (leverage) and managing accounts. as it was pooled money, traders depositis were at risk by others in the firm, and class A members used up to x% of deposits for cashflow, expenses, etc... we all knew this. we were doing around 1.5B shares month. i never had a problem getting any money and spoke to the owner's weekly. great guys.

anyway, the judge appointed a temp. receiver on our dime, along with accountants to the tune of $2100/hr after the "prima faciae" showing that they were in fact defrauding us, hah. attempting to prevent a bankruptcy our lawyer's decided not to fight it and threw in the towel early, as the indications were clear the sec wanted us shut down. before the receiver became permanent we were supposed to be getting deposits back within the month. now that he has become permanent, there are all sorts of excuses coming up and it's becomming apparent that he intends to extend this for as long as he can... all on our dime of course. (on a phone conversation with him before his permanence, he stated it should be wrapped in 60 days, we just received email he would be applying for IRS extensions for October!)

while i would love to dialog about the legality or merit of the entire case, i don't want to take up your time (unless you'd like to discuss it). essentially, what i'd like to know is, do we as traders or class b members of the firm have any way of influencing or enforcing a timely distribution, or are we powerless to this receiver who is very obviously working under a very large conflict of interest?

court orders, sec complaints, and recent notices can be viewed on the receiver's site here: http://www.tflinc.com/cases_tuco.html

thanks for any comments or input you can provide.