For Release: February 11, 2002
NEW YORK COMMODITY BROKER CHARGED WITH ILLEGAL TRADING AND VIOLATION OF A COMMISSION ORDER
CFTC Alleges Branch Manager Patrick Ligammari Engaged in Non-Competitive Trading To Facilitate the Transfer of Over $300,000 Between Two Foreign Accounts
WASHINGTON, D.C. – The Commodity Futures Trading Commission (CFTC) announced today the filing of an administrative action against Patrick Ligammari (Ligammari) of Staten Island, New York. Ligammari is an account executive and branch manager of a commodities firm. The CFTC complaint charges that from March 1998 to May 1998, Ligammari unlawfully engaged in certain non-competitive trades, known as the contingent exchange for physical transactions (EFPs), to facilitate the transfer of over $300,000 between two foreign accounts.
The complaint alleges that Ligammari was the account executive for two foreign accounts that were under common control and ownership. According to the complaint, on 14 occasions, he executed equal and opposite positions in silver futures contracts for the foreign accounts and then offset those futures positions through a contingent EFP during COMEX floor trading hours, resulting in profits of approximately $375,000 for one account and a corresponding loss of approximately $375,000 for the other account.
A contingent EFP is a transaction in which the trades do not result in an actual transfer of ownership of the physical commodity. COMEX rules prohibit EFPs between commonly owned or controlled accounts and the execution of contingent EFPs during floor trading hours. The EFP transactions were therefore illegal noncompetitive trades that constituted wash sales and resulted in the reporting of non bona fide prices in violation of the Commodity Exchange Act (CEA), according to the complaint.
The complaint further alleges that Ligammari’s wash sale activities are a violation of a 1990 CFTC order which directed him to cease and desist from violating the CEA and which prohibited him from engaging in wash sales.
A public hearing has been ordered to determine whether the allegations are true.
Possible sanctions include a cease and desist order, civil monetary penalties, trading
prohibitions, and registration revocations, suspensions or restrictions.
To see a copy of the settlement order, go to the following Internet web address: http://www.cftc.gov/
Exhibit A - 1990 Order
Richard Wagner, Associate Director
CFTC Division of Enforcement
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