For Release: January 29, 2010
CFTC Charges Illinois Defendants Jay C. Nolan and His Company, Lodge Capital Group, LLC, with Commodity Pool Fraud
Court issues emergency order freezing defendants’ assets and protecting books and records
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced that it obtained an emergency federal court order freezing the assets of defendants Jay C. Nolan of Wilmette, Ill. and his company, Lodge Capital Group, LLC (Lodge Capital), an Illinois limited liability company based in Northfield, Ill.
The court’s order, entered by the Honorable Charles R. Norgle, Sr. of the U.S. District Court for the Northern District of Illinois, also prohibits the destruction of books and records. The order sets a hearing on February 9, 2010, on the CFTC’s motion for a preliminary injunction.
CFTC charges defendants with commodity pool fraud; defendants fraudulently solicited approximately $3.9 million from at least five pool customers
The court’s order stems from a CFTC civil enforcement action filed on January 25, 2010, charging Nolan and Lodge Capital with fraud in connection with the operation of a commodity pool. According to the complaint, from at least December 2004 to the present, the defendants fraudulently solicited approximately $3.9 million from at least five individuals. In their solicitations, the complaint charges that Nolan and Lodge Capital made misrepresentations and failed to disclose material facts to pool participants regarding the profitability of the pool and the performance of the participants’ investments in the pool.
The complaint further alleges that the defendants sent false account statements to participants that misrepresented the value of the participants’ interests in the commodity pool and the assets and liabilities of the pool. Finally, Nolan allegedly misappropriated some of the pool participant’s monies in the form of incentive fees to which he was not entitled because of the pool’s sustained overall losses.
In its continuing litigation, the CFTC seeks a return of ill-gotten gains, restitution to defrauded customers, civil monetary penalties and permanent injunctions prohibiting the defendants from violating federal commodity laws and from engaging in further trading.
The CFTC appreciates the assistance of the Federal Bureau of Investigation and the United States Attorney’s Office for the Northern District of Illinois, which filed a criminal complaint against Nolan on November 24, 2009.
The following CFTC Division of Enforcement staff members are responsible for this case: Diane M. Romaniuk, Ava M. Gould, Mary Beth Spear, Scott R. Williamson, Rosemary Hollinger and Richard B. Wagner.
Last Updated: January 29, 2010