Small Engine Troubleshooting Problems? Ask a Mechanic Now.
If the control valve is moving the spool in the reverse direction, seems to be a problem with the relief valves for the reverse section. Manual shows the relief valve location in the manual on page # 22. See manual link below. Swap the valves for test.
Is the control valve moving the spool for the reverse function, or has the spool come loose on the bottom side?