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Wednesday, March 11, 2015

MAN WHO MISAPPROPRIATED COMMODITY POOL MONEY SENTENCED TO 8+ YEARS IN PRISON

FROM:  U.S. COMMODITY FUTURES TRADING COMMISSION 
Kevin G. White Sentenced to over Eight Years in Federal Prison for $7.4 Million Commodity Pool Investment Scam

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced that Kevin G. White of The Woodlands, Texas, who orchestrated a $7.4 million commodity pool investment scam during which he misappropriated approximately $1.7 million from pool participants, was sentenced to over eight years in federal prison for charges related to his fraudulent misconduct. Earlier, on December 11, 2013, White pleaded guilty to committing mail fraud for his actions in connection with the scam.

The criminal charges arose from White’s solicitation fraud and misappropriation of pool participant funds, as charged in a Complaint filed by the CFTC on July 9, 2013 (see CFTC Press Release 6644-13, July 12, 2013), and a companion Complaint filed by the Securities and Exchange Commission. According to the CFTC’s Complaint, White, along two other Defendants in the CFTC’s action, RFF GP, LLC, and KGW Capital Management, LLC, duped pool participants into investing in Revelation Forex Fund, LP, a purported hedge fund and commodity pool. The CFTC’s Complaint further alleged that in making their solicitations through two websites and at a tradeshow presentation, White fabricated Revelation’s performance and lied about his investment experience. A proposed consent Order between the CFTC and White, RFF GP, and KGW Capital is currently pending in the U.S. District Court for the Eastern District of Texas.

Aitan Goelman, the CFTC’s Director of Enforcement, stated: “The sentence in this case should serve as a warning that those who willfully commit fraud in our markets face the very real possibility of a significant term of imprisonment. The CFTC will continue its vigilance in protecting commodities and derivatives investors from fraud and other forms of financial crime.”

The CFTC congratulates the U.S. Attorney’s Office for the Eastern District of Texas for its successful prosecution of this matter.

CFTC Division of Enforcement staff members responsible for the related CFTC case are Harry E. Wedewer, Dmitriy Vilenskiy, John Einstman, and Paul G. Hayeck.

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