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RELEASE: pr5513-08

  • Release: 5513-08

    For Release: June 19, 2008

    Illinois Resident Cameron Charles Ordered to Pay a $100,000 Civil Penalty and Submit to a Permanent Trading Ban in Connection with the Financial Collapse of Watseka Farmers Grain Co. Cooperative

    Co-Op Manager’s Unauthorized Speculation in Soybean Futures Forced Co-op Into Bankruptcy

    Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it obtained a consent order of permanent injunction requiring Cameron Charles of Watseka, Illinois, to pay $100,000 in civil monetary penalties, and permanently prohibiting him from engaging in any commodity futures trading on behalf of himself or others or applying for registration, claiming exemption from registration or engaging in any activity requiring registration with the CFTC.

    The consent order, entered on June 18, 2008, by Honorable Harold A. Baker of the U.S. District Court for the Central District of Illinois, arises from a CFTC lawsuit filed on June 23, 2005 (see CFTC Press Release 5094-05, June 30, 2005). The CFTC alleged that Charles defrauded his employer, Watseka Farmers Grain Co. Cooperative (Watseka), by engaging in unauthorized and illegal speculative trading on its behalf, and that Charles accepted and processed futures trades for individuals through Watseka’s trading account without proper registration with the CFTC.

    Watseka was a small grain elevator formed by local farmers to market their corn and soybean crops. As Watseka’s manager, Charles’ responsibilities included hedging Watseka’s grain positions on the futures market and reporting such positions to the Illinois Department of Agriculture.

    From at least January 2004 through May 2004, Charles caused Watseka to accumulate a large, unauthorized, speculative position in the soybean futures market, which he concealed from Watseka’s Board of Directors and the Illinois Department of Agriculture by falsifying Watseka’s records. In mid-May 2004, the soybean futures market declined sharply and Watseka received margin calls that it could not meet, forcing the co-op into liquidation. Watseka closed on May 24, 2004.

    Charles also accepted orders for futures transactions from local farmers and executed these transactions through Watseka’s futures trading account without being registered with the CFTC to handle those transactions.

    The following CFTC Division of Enforcement staff members are responsible for this case: Mark Bretscher, William Janulis, Merle Hampton, Scott Williamson, Rosemary Hollinger, and Richard Wagner.

    Media Contacts
    Ianthe Zabel
    202-418-5080

    Dennis Holden
    202-418-5088

    Last Updated: June 19, 2008

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