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Wednesday, December 10, 2014

CFTC CHARGES MAN WITH FRAUD AND ACTING AS AN UNREGISTERED FUTURES COMMISSION MERCHANT

FROM:  U.S. COMMODITY FUTURES TRADING COMMISSION 
November 25, 2014
CFTC Charges California Resident Thomas Gillons with Fraud and Acting as an Unregistered Futures Commission Merchant

Federal Court Issues Emergency Order Freezing Gillon’s Assets and Protecting Books and Records

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced the filing of a civil enforcement action in the U.S. District Court for the Northern District of Illinois, charging Defendant Thomas Gillons of Napa County, California, with fraud and acting as a Futures Commission Merchant (FCM) without being registered as such with the CFTC.

On the same day the Complaint was filed, November 19, 2014, U.S. District Judge Ronald A. Guzman issued an emergency Order freezing and preserving assets under the control of Gillons and prohibiting him from destroying documents or denying CFTC staff access to his books and records. The court scheduled a hearing for December 1, 2014, on the CFTC’s motion for a preliminary injunction.

Gillons Allegedly Misappropriated Nearly $130,000 in Customer Funds

The CFTC’s Complaint alleges that, since at least August 31, 2013, Gillons fraudulently solicited and accepted at least $194,000 from at least three customers by claiming that he was a licensed broker and would trade their funds in a sub-account in customers’ names, earning them a 12 to 14 percent return. However, in reality, Gillons’ broker license had been suspended, and he was not currently registered with any securities firm, according to the Complaint. Moreover, Gillons traded only a portion of customer funds, losing approximately $55,234 and misappropriating at least $129,766 in customer funds, the Complaint alleges.

Furthermore, the Complaint alleges that Gillons accepted money to margin, guarantee, or secure commodity futures trades without being registered with the CFTC as an FCM.

In its continuing litigation, the CFTC seeks restitution, disgorgement of ill-gotten gains, civil monetary penalties, trading and registration bans, and injunctions against further violations of the Commodity Exchange Act.

CFTC Division of Enforcement staff members responsible for this action are Stephanie Reinhart, Melissa Glasbrenner, David Terrell, Scott Williamson, and Rosemary Hollinger.

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