November 27, 2013
Federal Court in California Orders James D. Crombie to Pay over $1.5 Million for Misrepresentations to the National Futures Association and for Solicitation Fraud
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) obtained a federal court Order against defendant James D. Crombie of Virginia, requiring him to pay $789,540.47 in restitution to defrauded customers and a civil monetary penalty of $750,000. Crombie’s fraudulent scheme involved making false statements and providing false documents to the National Futures Association (NFA) and fraudulently soliciting funds for his former company, Paron Capital Management, LLC (Paron). The Order also imposes permanent trading and registration bans against Crombie and prohibits him from violating the Commodity Exchange Act, as charged.
The Order, entered on November 21, 2013 by the Honorable Claudia Wilken of the U.S. District Court for the Northern District of California, stems from a CFTC Complaint filed against Crombie and Paron on September 15, 2011 (see CFTC Press Release 6112-11). On September 5, 2012, the court entered a consent Order of permanent injunction against Crombie’s former company, Paron; that Order imposed no monetary penalties against Paron and noted its cooperation with the CFTC’s investigation.
The November 21, 2013 Order against Crombie incorporated the findings of fact and conclusions of law set forth in the court’s July 26, 2013 partial grant of the CFTC’s motion for summary judgment against Crombie, in which the court found that Crombie willfully provided false documents to the NFA and lied to the NFA during the course of a subsequent investigation of Paron. The court also found on summary judgment that Crombie caused Paron to use fraudulent promotional materials in order to solicit clients to trade commodity futures.
The CFTC appreciates the cooperation and assistance of the NFA in this matter.
The CFTC Division of Enforcement staff members responsible for this case are Jonathan Robell, Danielle Karst, John Einstman, Dmitriy Vilenskiy, Joan Manley, and Paul Hayeck.
Last Updated: November 27, 2013