CFTC News Release 4422-00 (CFTC Docket No. 00-25)
For Release: July 17, 2000
CFTC FILES AND SETTLES ACTION AGAINST WILLIAM G. BILLINGS AND BILLFUND, INC. OF OKLAHOMA IN CONNECTION WITH THE FRAUDULENT OPERATION OF THREE COMMODITY POOLS
CFTC Order Finds That the Respondents Defrauded at Least 40 Pool Participants Out of Approximately $1.6 Million
WASHINGTON -- The Commodity Futures Trading Commission (CFTC) announced today that it issued an order filing and simultaneously settling an administrative proceeding against William G. Billings and Billfund, Inc., of Bartlesville, Oklahoma, finding that the respondents fraudulently operated three commodity pools. Billings and Billfund, Inc. were registered with the CFTC as commodity pool operators (CPOs) from December 1988 through January 1999.
The CFTC order finds that Billings operated three commodity pools -- BilCom, the 20% Fund and Billfund, LP -- at various times from 1988 through 1997. The order finds that the three commodity pools collectively took in approximately $1.64 million from more than 40 pool participants, distributed approximately $731,500 back to investors, and lost approximately $504,400 trading investors’ funds. Billings misappropriated the remaining approximately $409,000 for his personal use, according to the order.
In addition, according to the order, Billings fraudulently guaranteed profits to investors in the 20% Fund of 20 percent annually; concealed trading losses from investors in the BilCom, 20% Fund, and Billfund, LP pools; and sent account statements to the investors falsely reporting gains in their accounts. The order also finds that Billings 1) misappropriated Billfund, LP assets, using them as collateral for personal bank loans and other personal uses, 2) commingled pool property with the property of others, and 3) failed to provide disclosure documents to pool participants.
According to the order, based on these findings, Billings and Billfund, Inc. violated the anti-fraud provisions of the Commodity Exchange Act (CEA), specifically sections 4b(a)(i), (ii) and (iii) and 4o(1), and CFTC regulations applicable to commodity pool operators.
In admitting to the order's findings, Billings and Billfund, Inc. consented to the entry of a settlement order, which permanently prohibits them from trading on any contract markets and further requires them to:
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