Chicago Trader Rye Accused of $1.5M Client Fraud

CHICAGO – Randall Rye, 26, of Chicago, is facing federal fraud charges after allegedly swindling more than a dozen clients out of at least $1.5 million. The owner of Faster Than Light Trading LLC, Rye allegedly pocketed investor funds instead of using them for the promised options and futures trading, authorities say.

According to a federal indictment returned Wednesday, Rye pitched investors a proprietary trading program promising “substantial profits” through a computer algorithm. The reality, prosecutors claim, was a brazen misappropriation of funds for Rye’s personal enrichment. The indictment details a lavish lifestyle fueled by stolen money – including vacations to St. Lucia and Bali, tickets to the World Series and the Masters golf tournament, and significant cash withdrawals.

The scheme spanned at least 15 investors, with Rye allegedly fabricating account statements from established financial services companies to mask the fraud. These statements falsely indicated that investors’ principal and profits were invested and profitable, even though the funds were never actually maintained at those institutions. Rye also allegedly operated a Ponzi scheme, using money from newer investors to pay off earlier ones, attempting to keep the ruse afloat.

Rye was arrested last month, and remains in federal custody. A search of his home and office yielded business records and several expensive watches, seized as potential evidence. The indictment charges Rye with six counts of wire fraud, each carrying a maximum penalty of 20 years in prison. Sentencing will be determined based on federal guidelines.

“The indictment contains only charges and is not evidence of guilt,” stated the U.S. Attorney’s Office. “The defendant is presumed innocent and is entitled to a fair trial.” Rye is scheduled for arraignment on March 21, 2017, before U.S. Magistrate Judge Michael T. Mason in Chicago.

The case is being prosecuted by Assistant United States Attorney Sunil Harjani. The investigation was conducted by the Federal Bureau of Investigation, Chicago office, led by Special Agent-in-Charge Michael J. Anderson. This is just the latest example of how easily investors can be preyed upon by those seeking to enrich themselves through deceit, and Grimy Times will continue to follow this case as it unfolds.