Release: #4161-98 (CFTC Docket No. 93-5)
For Release: June 30, 1998
CFTC ACCEPTS SETTLEMENT OFFER OF LAWRENCE J. BILELLO
Settlement Agreement Revokes Bilello's Registration with the CFTC and
Orders Him to Pay a $200,000 Civil Penalty, Among Other Sanctions
WASHINGTON – The Commodity Futures Trading Commission (CFTC) announced today that it issued an order accepting an offer of settlement from Lawrence J. Bilello, to resolve an administrative proceeding initiated by the CFTC on March 2, 1993 (see CFTC News Release #3633-98, March 2, 1993).
The CFTC order, filed on June 26, 1998, finds that Bilello, a registered floor broker on the Commodity Exchange, Inc., violated provisions of the Commodity Exchange Act (CEA) and CFTC regulations prohibiting: fraudulent activity in connection with the execution or reporting of a trade; wash sales; fictitious sales; causing the reporting of non bona fide prices; and noncompetitive trading.
In addition, the CFTC order finds that Bilello participated in noncompetitive trades with floor brokers and floor traders involving customer orders. In certain trade sequences, Bilello indirectly bucketed a customer order, while in others, he used a customer order for one contract month to facilitate a trade for himself in another contract month. In addition, in two instances, he changed the price of a trade to a customer's detriment. The CFTC order further finds that Bilello engaged in noncompetitive wash sales in which money was passed between Bilello and another broker or trader.
Bilello, without admitting or denying the findings, consented to the entry of the order:
-- finding that he engaged in fraudulent activity, made false reports, and bucketed (section 4b(a) of the CEA and CFTC regulation 1.38); and engaged in wash sales, fictitious sales, and caused prices to be reported that were not true and bona fide (sections 4c(A) and 4c(B) of the CEA);
-- directing him to cease and desist from further violations;
-- revoking his registration;
-- imposing a three-year personal trading ban; and
-- directing him to pay a $200,000 civil monetary penalty.
Under the settlement, Bilello also agreed never to seek registration with the CFTC in any capacity.