Chicago, IL – John Edward Walsh, of Lake Forest, Illinois, has been ordered to pay a $260,000 civil penalty for violations of Commodity Futures Trading Commission (CFTC) net capital requirements, the agency announced March 4, 2010. The order, entered by U.S. District Court Judge Joan H. Lefkow for the Northern District of Illinois on February 25, 2010, resolves a complaint initially filed December 13, 2007.
The CFTC charged Walsh, as president of One World Capital Group, LLC, a registered futures commission merchant and forex dealer, with failing to demonstrate compliance with capitalization requirements and for failing to maintain accurate books and records. According to the court order, Walsh admitted he could not accurately calculate One World’s net capital due to an inability to determine current liabilities to forex customers and the company’s ability to meet those obligations.
On December 13, 2007, available financial accounts held by One World totaled only $639,815, a shortfall of at least $9 million when compared to claimed customer liabilities related to foreign currency contract trading. The CFTC also found that One World and Walsh failed to adhere to required CFTC record-keeping regulations.
Separately, on March 4, 2010, the CFTC revoked One World Capital Group’s registrations as both a futures commission merchant and a commodity trading advisor. In January 2009, Walsh was arrested on separate federal fraud charges related to the operation of One World Capital Group. Criminal authorities subsequently seized assets belonging to both Walsh and the company, including funds previously frozen by the court in the CFTC action.
The CFTC investigation was conducted in coordination with the National Futures Association (NFA), with assistance from the United States Attorney’s Office for the Northern District of Illinois and the British Columbia Securities Commission.
Source: CFTC.gov
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