Among the enforcement actions in which the CFTC obtained monetary sanctions orders in FY 2011, the following actions are examples of cases that included related actions by other civil and/or criminal authorities.
On October 4, 2010, the CFTC obtained a judgment order in the U.S. District Court for the District of Idaho for more than $41.2 million in disgorgement and civil monetary penalties against Daren Palmer and his company, Trigon Group LLC. The judgment order found that the defendants engaged in solicitation fraud and misappropriation in operating a commodity pool Ponzi scheme. In a related criminal proceeding, the U.S. Attorney for the District of Idaho indicted Palmer for the same conduct alleged in the CFTC enforcement action.
On December 1, 2010, the CFTC obtained $25.7 million in civil monetary penalties and restitution in a federal court order against CRE Capital Corporation and its owner James G. Ossie. The order resolved a CFTC enforcement action that charged the defendants with operating a $25 million foreign currency Ponzi scheme. At the same time, a similar order was entered against the defendants in a parallel action filed by the Securities and Exchange Commission. In a related criminal action by the U.S. Attorney for the Northern District of Georgia, Ossie pled guilty to criminal charges based on the same conduct alleged in the CFTC's complaint, was sentenced to 82 months in prison, and ordered to pay more than $18.7 million in criminal restitution to the victims of his scheme.
On December 1, 2010, the CFTC filed a civil injunctive action in the U.S. District Court for the District of Utah charging two Mexican companies with fraudulently soliciting over $28 million from 800 customers for the purpose of engaging in foreign currency transactions. The CFTC engaged in cooperative enforcement efforts with the Securities and Exchange Commission which simultaneously filed a related parallel action.
On January 28, 2011, the U.S. District Court for the District of Minnesota issued an order imposing more than $84 million in disgorgement and civil monetary penalties against Charles E. Hays and his company Crossfire Trading, LLC. The order stems from a CFTC complaint charging Hays and Crossfire with fraudulently soliciting and misappropriating customer funds in connection with operating a fraudulent commodity pool scheme. Following a plea to criminal charges based on substantially the same facts as alleged in the CFTC's enforcement action, Hays was sentenced to 117 months imprisonment and ordered to pay more than $21 million in restitution to defrauded investors.
On February 8, 2011, the CFTC obtained a federal court order imposing more than $46.9 million in restitution and civil monetary penalties on Robert D. Bame and his firm Forward Investment Group, LLC in connection with a CFTC action charging them with commodity pool fraud. In a related criminal proceeding, Bame pled guilty to wire fraud and other criminal counts. Bame was ordered to pay restitution in an amount equal to the restitution entered in the CFTC order. Bame is currently serving a 97 month prison sentence.
On March 2, 2011, the CFTC obtained a federal court order imposing more than $49.7 million in restitution and civil monetary penalties on Dennis R. Bolze and his company Centurion Asset Management, Inc. The order stems from a CFTC complaint charging Bolze and Centurion with commodity pool fraud and operating a Ponzi scheme. In a related criminal proceeding by the U.S. Attorney's Office for the Eastern District of Tennessee, Bolze was sentenced to 27 years and 3 months in prison.
On March 9, 2011, the U.S. District Court for the Northern District of Illinois issued an order requiring Brookshire Raw Materials Management, LLC and its principals, John M. Marshall and Stephen Z. Adams, to pay more than $15.8 million in disgorgement and a civil monetary penalty for defrauding commodity pool investors. The order stems from a complaint that charged the defendants with misappropriating more than $4.6 million of customer funds in a Ponzi scheme and destroying records. In a related criminal proceeding, Marshall and Adams pled guilty to a criminal indictment.
On April 15, 2011, the CFTC obtained a federal court order imposing more than $12 million in restitution and civil monetary penalties on Brian Kim and his company, Liquid Capital Management, LLC, for fraud in connection with the operation of a commodity pool. In a related criminal proceeding, a New York County Grand Jury indicted Brian Kim in February 2011.