LAKEMAY, TEXAS – David Seibert, formerly of Lakeway, Texas, has been ordered to pay over $13 million in restitution and penalties for defrauding investors, the Commodity Futures Trading Commission (CFTC) announced Friday. The U.S. District Court for the Western District of Texas entered a consent order on July 6, resolving a case initially filed in September 2020.
The court previously found Seibert liable for solicitation fraud and misappropriation of client funds in September 2020, permanently banning him from trading and registration. Today’s order mandates Seibert pay $10,794,508 in restitution to the victims of his scheme and a $2,278,853 civil monetary penalty.
Between March 2016 and April 2019, Seibert allegedly solicited over $10 million from 11 participants, falsely claiming the funds would be used for short-term “bridge loans” to borrowers needing funds for property repairs. Seibert promised to handle all aspects of the loans, including due diligence and servicing. However, the CFTC found he never actually originated any loans.
Instead, Seibert pooled the funds and used the majority to trade commodity interests in a personal account, losing over $8.3 million. Remaining funds were diverted for personal expenses, according to court findings.
This CFTC action runs parallel to a criminal case brought by the U.S. Attorney’s Office for the Western District of Texas. Seibert pled guilty to two counts of wire fraud and engaging in monetary transactions derived from unlawful activity in December 2021 and was sentenced to 70 months of incarceration followed by three years of supervised release. He also faced criminal forfeiture and was ordered to pay $10,794,508 in restitution as part of the criminal proceedings.
The CFTC’s enforcement team included Heather Dasso, Susan B. Padove, David Terrell, Scott R. Williamson, and Robert T. Howell.
Source: CFTC.gov
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