Walnut Creek, CA – February 13, 2007 – Gilbert Philip Castillo, Jr. has been ordered to pay $1.29 million in restitution and penalties for defrauding investors through unregistered commodity trading advisory services, the Commodity Futures Trading Commission (CFTC) announced today. The order, entered by U.S. District Court Judge Thelton E. Henderson in the Northern District of California on February 5, 2007, resolves charges brought against Castillo and his company, Castle Enterprise Corporation.
Castillo and Castle were found to have violated anti-fraud provisions of the Commodity Exchange Act (CEA) and CFTC regulations. The CFTC alleged that from at least February 1, 1999, through mid-2005, the defendants operated websites – WallStreetWar.com, CastilloResearch.com, and Never-Lose.com – and made false representations regarding Castillo’s trading successes and the profitability of their commodity advisory services.
The complaint detailed that Castillo and Castle fraudulently solicited members of the public while operating as an unregistered Commodity Trading Advisor (CTA). They allegedly induced investors to purchase advisory services, managed account programs, trading systems, and training courses related to S&P 500 Index futures and options. The CFTC asserts that these misrepresentations led to over $800,000 in customer funds being collected.
As a result of the violations, Castillo is required to disgorge $814,858.89 to provide restitution to victims. He and Castle Enterprise Corporation must also pay a $480,000 civil monetary penalty. The order permanently prohibits Castillo from engaging in any business activities related to commodity futures trading.
The case was led by CFTC Division of Enforcement staff members David Reed, Timothy J. Mulreany, Mary Kaminski, Paul Hayeck, and Joan Manley.
Source: CFTC.gov
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