David M. Nunn, a Vermont resident and former floor broker, has been permanently banned from trading commodities after admitting to a two-year scheme involving fictitious trades and false statements, according to a December 19, 2013 announcement by the U.S. Commodity Futures Trading Commission (CFTC).
Judge Lewis A. Kaplan of the U.S. District Court for the Southern District of New York entered a consent order against Nunn on December 18, 2013, following a complaint filed by the CFTC on October 18, 2012. The complaint detailed how Nunn engaged in over 1,300 non-competitive and fictitious trades in coffee futures contracts on ICE Futures U.S., Inc. (ICE) between July 2008 and September 2010.
The CFTC alleges that Nunn used this scheme to illicitly transfer over $1.68 million to an account he controlled. He intentionally placed virtually simultaneous buy and sell orders in accounts held in his name or under the control of another person, creating the appearance of legitimate trades.
Furthermore, the order states that Nunn made false statements to ICE officials during an interview, denying the transfer of funds from the controlled account. As a result of his actions, Nunn is required to pay a $600,000 civil monetary penalty.
In addition to the financial penalty, Nunn is permanently prohibited from trading on any registered entity, soliciting or receiving funds for trading, applying for registration with the CFTC, or acting as a principal or agent for any CFTC registrant. ICE has also expelled Nunn from membership and barred him from accessing their markets. The CFTC acknowledged the assistance provided by ICE during the investigation.
The case was led by CFTC Division of Enforcement staff members Trevor Kokal, Michael Geiser, David Oakland, David Acevedo, Lenel Hickson, and Manal Sultan.
Source: CFTC.gov
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