For Release: March 5, 2008
Illinois Federal Court Orders Peter D. Hoffman to Pay $492,850 in Restitution and Civil Monetary Penalties in CFTC Anti-Fraud Action
Hoffman’s Misconduct Violated a Prior CFTC Order Against Him Based on Similar Misconduct
Washington, DC − The U.S. Commodity Futures Trading Commission (CFTC) announced today that it obtained $492,850 in sanctions and a permanent injunction in a consent order that settles its fraud charges against Peter D. Hoffman. The consent order permanently bars Hoffman from engaging in any commodity-related activity, including registering with the CFTC, and requires payment of $252,850 in restitution to his defrauded customers and a $240,000 civil monetary penalty.
Hoffman, formerly a resident of Chicago, currently resides in Humble, Texas and has never been registered with the CFTC in any capacity.
The consent order against Hoffman, entered by the Honorable Joan H. Lefkow of the U.S. District Court for the Northern District of Illinois on March 4, 2008, resolves a commodity futures anti-fraud action filed by the CFTC in November 2006. That action charged Hoffman with fraudulently soliciting potential customers, acting as an unregistered Commodity Trading Advisor (CTA), and violating a prior CFTC administrative order of March 1999 against Hoffman. (See CFTC Press Releases 4249-99, March 31, 1999 [Docket No. 99-9] and 5260-06, November 30, 2006.)
The 1999 CFTC order found that Hoffman had fraudulently marketed a commodity trading system while acting as an unregistered CTA in violation of the Commodity Exchange Act and CFTC regulations. The order required Hoffman to cease and desist from making false representations, imposed a five-year ban on trading on contract markets for himself or on behalf of anyone else, and prohibited him from ever applying for registration with the CFTC in any capacity and from ever engaging in any activity requiring registration.
The consent order finds that, between at least February 2000 to at least March 2006, Hoffman violated Federal commodity laws and regulations, as well as the March 1999 order against him, by fraudulently soliciting customers, acting as a CTA, and trading commodity futures in violation of a prohibition imposed by the March 1999 order.
Specifically, the consent order finds that, between at least February 2000 and April 2004, Hoffman circumvented the five-year trading ban by funding and/or directing trading in a series of commodity futures accounts. The order further finds that, during that same time period and thereafter, Hoffman cheated his clients by falsely claiming he was a successful trader, failing to disclose the prior CFTC order against him, and acting as a CTA without the benefit of CFTC registration.
The following Division of Enforcement staff members are responsible for this case: Jennifer S. Diamond, Elizabeth M. Streit, Susan J. Gradman, Thomas Koprowski, Scott R. Williamson, Rosemary Hollinger, and Richard Wagner.
Last Updated: March 5, 2008