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March 15, 2022

London-based swap dealer ED&F Man Capital Markets, Ltd. will pay $3.25 million to resolve claims that it failed to comply with swap dealer requirements including by failing to report accurate swaps data to a swaps data repository, failing to disclose to its U.S. swaps counterparties that affiliated-entity proprietary traders had access to counterparties’ trade information, and failing to disclose mid-market marks to counterparties. The CFTC further found that the entity failed to maintain an adequate supervisory system or perform its supervisory obligations diligently.  CFTC

Tagged in: Financial and Investment Fraud, Fraud in CFTC-Regulated Markets, Regulatory Violations,

March 10, 2022

The CFTC has awarded two whistleblowers awards totaling approximately $500,000 after they separately provided significant information and substantial assistance that helped lead to a successful enforcement action.  According to the agency, the whistleblowers’ tip helped expand the scope of an existing investigation and led to other key evidence.  CFTC

Tagged in: CFTC Whistleblower Reward Program, Fraud in CFTC-Regulated Markets, Whistleblower Rewards,

February 23, 2022

The CFTC settled charges against Richard D. Neal and his company Golden Signals, LLC for failing to register as a commodity trading advisor and commodity pool operator. Neal and Golden Signals, LLC will pay over $2.6 million in restitution, disgorgement, and a civil monetary penalty for the fraud perpetrated over a 5-year period beginning in October 2016. They engaged in binary options solicitation and trading fraud via webpages and social media channels, touting “the highest profit percentage ratings in the world.” Additionally, customers lost over $1.2 million through Neal and Golden Signals’ fraudulent solicitations for binary options signal, trainings, and strategy course offerings. CFTC

Tagged in: Financial and Investment Fraud, Fraud in CFTC-Regulated Markets, Misrepresentations, Regulatory Violations,

January 19, 2022

William S. Evans III, who did business as Turning Point Investments, together with his wife Francis Evans, have consented to entry of judgment against them requirement the payment of $17 million as restitution as the disgorgement of $10 million.  Evans operated as an unregistered commodity pool operator, and marketed to customers with the promise that he would trade commodity futures on their behalf, making false statements about risks, the likelihood of profits, and his fees.  In fact, Evans misappropriated customer funds for his personal use and to pay other participants in a Ponzi-like scheme.  CFTC

Tagged in: Financial and Investment Fraud, Fraud in CFTC-Regulated Markets, Misrepresentations, Regulatory Violations,

January 3, 2022

Blockratize, Inc., d/b/a Polymarket has been ordered to pay a $1.4 million civil monetary penalty to resolve charges of violating the Commodity Exchange Act and CFTC regulations.  According to the CFTC, Polymarket illegally offered over 900 separate off-exchange event-based binary options contracts, and failed to obtain designation as a designated contract market (DCM), or register as a swap execution facility (SEF).  CFTC

Tagged in: Financial and Investment Fraud, Fraud in CFTC-Regulated Markets, Regulatory Violations,

December 17, 2021

Easterday Ranches, Inc. has been ordered to pay a $30 million civil penalty and $233 million in restitution following an investigation into claims that the company, which has since filed for bankruptcy, sold more than 200,000 head of non-existent cattle to a beef processor and falsely reported information about its cattle inventory, purchases, and sales to the Chicago Mercantile Exchange in two hedge exemption applications seeking permission to exceed the exchange’s position limits.  CFTC

Tagged in: Financial and Investment Fraud, Fraud in CFTC-Regulated Markets, Misrepresentations,

December 17, 2021

J.P. Morgan Chase entities, including broker-dealer J.P. Morgan Securities LLC, will pay a total of $200 million -- $125 million as an SEC penalty and $75 million as a CFTC penalty -- to resolve claims that firm employees communicated both internally and externally on unapproved channels, failed to preserve written communications, and failed to supervise.  Defendants admitted that employees, including senior and supervisory employees, regularly and openly communicated about business using personal devices, text messages, WhatsApp, and other private messaging, none of which were preserved by the firm, in violation of recordkeeping requirements.  As a result, J.P. Morgan entities were unable to provide information in response to subpoenas and information requests from regulators.  SEC; CFTC

Tagged in: Financial and Investment Fraud, Financial Institution Fraud, Fraud in CFTC-Regulated Markets, Regulatory Violations, Securities Fraud,

November 29, 2021

Denari Capital LLC and its principals Travis Capson and Arnab Sarkar have been ordered to pay a total of $4 million in penalties and restitution based on findings that they engaged in foreign exchange (forex) pool fraud and failed to register with the CFTC as a commodity pool operator and associated persons.  Defendants misrepresented Denari’s trading and performance in fraudulent solicitations, issued false account statements, and improperly commingled pool funds.  CFTC

Tagged in: Foreign Exchange, Fraud in CFTC-Regulated Markets, Misrepresentations, Ponzi Schemes, Regulatory Violations,

November 22, 2021

Two whistleblowers received awards totaling approximately $1 million, with the CFTC finding that the first claimant voluntarily provided specific, credible, and timely information that led the CFTC to open an investigation, and the second claimant voluntarily provided information that significantly contributed to the success of the covered action.  In support of a larger award for the first claimant, the CFTC cited their submission of documents and sharing of knowledge during the earliest stages of the CFTC’s investigation, which focused investigative efforts and conserved government time and resources.  CFTC

Tagged in: CFTC Whistleblower Reward Program, Fraud in CFTC-Regulated Markets, Whistleblower Rewards,

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