September 25, 2012
CFTC Seeks to Revoke Registrations of Victor E. Cilli and his Company Progressive Investment Funds, LLC
Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced the filing of a notice of intent to revoke the registrations of Victor E. Cilli and Progressive Investment Funds, LLC (PIF). PIF, based in Hackensack, N.J., is a registered Commodity Pool Operator. Cilli is a New Jersey resident registered as an Associated Person of PIF and is PIF’s sole principal.
The CFTC notice, filed on September 21, 2012, alleges that Cilli and PIF are subject to statutory disqualification from CFTC registration based on a consent order for permanent injunction entered by the U.S. District Court for the District of New Jersey on May 29, 2012 (see CFTC Release 6267-12, May 30, 2012). The consent order finds, in relevant part, that Cilli and PIF engaged in fraud by misrepresentations and omissions of material facts by: 1) knowingly and willfully sending pool participants statements that falsely stated that the commodity pool they operated had made money when, in fact, the pool had lost money trading, 2) by omitting that Cilli had only traded a portion of the pool’s funds, and 3) by engaging in a Ponzi scheme by sending some pool participants purported profits in order to conceal the scheme. The consent order also permanently enjoined Cilli and PIF from further violations of the anti-fraud provisions of the Commodity Exchange Act, imposed restitution of $243,000, and ordered them to pay a $474,000 civil monetary penalty.
In addition, the notice alleges that Cilli and PIF are subject to disqualification from CFTC registration based on Cilli’s conviction for criminal securities fraud in connection with the commodity pool he operated, as entered by the U.S. District Court for the District of New Jersey on October 3, 2011. Cilli was convicted, in relevant part, of: 1) engaging in a Ponzi scheme that defrauded four commodity pool participants of $506,000, 2) trading only approximately $263,000 of the pool funds, losing approximately $200,168 of that amount, and failing to disclose this information to the pool participants, 3) sending some of the pool participants false statements showing profits when, in fact, the pool lost money, and 4) misappropriating thousands of dollars to pay for personal expenses. On June 18, 2012, the District Court sentenced Cilli to 36 months in prison and ordered him to pay $243,000 in restitution.
CFTC Division of Enforcement staff members responsible for this action are W. Derek Shakabpa, Judith M. Slowly, David Acevedo, Lenel Hickson Jr., Stephen J. Obie, and Vincent A. McGonagle.
Last Updated: September 27, 2012