WASHINGTON, DC – Former Chicago Board of Trade (CBOT) floor broker John Lee Neuman of Naperville, Illinois, has been permanently banned from trading commodities after the U.S. Commodity Futures Trading Commission (CFTC) settled fraud and unauthorized trading charges against him on August 30, 2010.
The CFTC found that Neuman, a CBOT member registered as a floor broker from May 1993 to February 2008, engaged in unauthorized trading on June 22, 2007, in the account of another corn options trader. Neuman allegedly disregarded the account owner’s risk limitations and made unauthorized purchases of approximately 4,000 July 2007 corn futures contracts despite a downward market trend.
According to the CFTC order, Neuman’s actions resulted in a net long futures position and approximately $8 million in margin calls that he could not cover. He further attempted to conceal his unauthorized trades from the account owner by misrepresenting profits, losses, and risks. Neuman also allegedly altered trade data within the account owner’s risk monitoring system and provided false statements.
The account owner ultimately suffered approximately $4 million in trading losses due to Neuman’s conduct. The CFTC order permanently prohibits Neuman from directly or indirectly trading on or subject to the rules of any registered entity and imposes a permanent ban on his CFTC registration. He is also required to cease and desist from violating anti-fraud provisions of the Commodity Exchange Act.
The CBOT previously pursued action against Neuman related to the same events, ordering him to pay $4 million in restitution to the affected account owner. The CFTC opted not to pursue a separate civil monetary penalty, citing the CBOT’s restitution order.
The CFTC’s Division of Enforcement staff included Camille Arnold, Susan Gradman, Judith McCorkle, Scott Williamson, Rosemary Hollinger, and Richard Wagner in this action.
Source: CFTC.gov
Related Federal Cases
- Letitia James, Securities Fraud, New York 2023 · Washington
- Eric Holub, Tax Withholding Fraud, Cedar Rapids IA, 2023 · Illinois
- Robert John Mueller, Methamphetamine Distribution, Dyersville IA, 2023 · Illinois
- Terry L. Gantt, ID Theft and Wire Fraud, Cedar Rapids IA, 2012 · Illinois
- Abel Hernandez-Labra, Passport Fraud, Hampton IA, 2023 · Illinois
MORE FEDERAL CRIME NEWS
US NewsUS NewsUS NewsUS News