For Release: May 7, 2003
TEXAS COMMODITY TRADER SETTLES CFTC CHARGES OF DEFRAUDING CUSTOMERS AND STEALING CUSTOMER FUNDS
CFTC Order Requires That Garland Resident Dewey V. Wiles Pay Restitution to Customers
WASHINGTON, D.C. – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it has settled an enforcement action against Dewey V. Wiles (Wiles) of Garland, Texas.
The settlement results from a CFTC action, filed on May 6, 2002 in the U.S. District Court for the Northern District of Texas, that charged that Wiles and his company, Futures Exchange Company, Inc. (FEC), fraudulently solicited customers to invest in a commodity futures trading scheme and then misappropriated customer funds. The complaint also charged the defendants with registration violations (see CFTC News Release 4639-02, May 8, 2002). In consenting to the entry of the order, Wiles did not admit or deny the findings in the order or the allegations in the complaint.
The settlement order, entered by the court on April 11, 2003, permanently bars Wiles from trading commodity futures on behalf of others and orders him to pay $385,628 in restitution, together with more than $645,000 in civil monetary penalties, pursuant to ten-year, income-based payment plans. A cash sum of $25,000 retrieved from Wiles will be disbursed to customers shortly.
The consent order finds that, between April 1998 and at least November 2001, Wiles fraudulently solicited approximately $683,200 from at least 61 customers by falsely guaranteeing that customers would realize large profits from trading commodity futures, minimizing the risks involved in such trading, and misrepresenting the performance of his trading system. The order also finds that Wiles fraudulently reassured customers about the success of their investments by issuing them false monthly statements reflecting bogus profits. According to the order, Wiles returned more than $431,700 to some customers as returns of equity or as phony trading profits, lost $42,000 trading and misappropriated $215,426 in customer funds by spending it on his personal and small business expenses.
The order permanently bars Wiles from further violations of the Commodity Exchange Act (CEA) as charged, from trading for other people, and from registering or acting for or on behalf of any person registered, required to be registered, or exempt from registration.
The court had previously entered a default order on October 16, 2002, which permanently enjoined FEC from violating the CEA and assessed civil penalties.
The following staff of the Division of Enforcement were responsible for this action: Ghassan Hitti, Peter Haas, Michael Solinsky, Patricia Gomersall, Susan Bovee, and Paul Hayeck.
The CFTC appreciates the assistance of the United States Attorney’s Office for the Northern District of Texas in filing and prosecuting this matter.
A copy of the CFTC complaint and the order may be obtained at www.cftc.gov.
Paul G. Hayeck
CFTC Division of Enforcement
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