CHICAGO, IL – Joseph Guinan, CEO of Advantage Futures LLC, has been charged with supervision failures by the U.S. Commodity Futures Trading Commission (CFTC), the agency announced on September 21, 2016. The CFTC alleges that Guinan, a resident of River Forest, Illinois, failed to diligently supervise the handling of commodity interest accounts at Advantage Futures, leading to deficient risk management and inaccurate reporting to the agency.
The CFTC’s order also names William Steele, former Chief Risk Officer of Advantage Futures and a resident of Vernon Hills, Illinois, for failing to supervise the firm’s risk management program. The alleged violations occurred between November 2011 and August 2015.
According to the CFTC, Advantage Futures and its executives were notified by three exchanges about potentially unlawful trading activity – specifically, patterns consistent with spoofing and manipulation – by one of its customers. Despite these warnings, the firm allegedly failed to thoroughly investigate the trading activity. While the customer was eventually restricted from trading specific futures contracts flagged by the exchanges, Advantage Futures did not extend increased scrutiny to the customer’s trading in other markets, allowing the suspect activity to continue.
The CFTC further alleges that Advantage Futures had deficient risk management and credit risk practices, for which Steele was responsible. The firm reportedly failed to adhere to its own risk management policies.
As a result of the charges, Advantage Futures, Guinan, and Steele have been ordered to pay a combined civil monetary penalty of $1.5 million. Additionally, Advantage Futures is required to implement improvements to its policies, procedures, and oversight practices, focusing on strengthening its Risk Management Program and Risk Department to prevent future violations. This case marks the CFTC’s first enforcement action under Regulations 1.11 and 1.73, which outline risk management and supervision obligations for Futures Commission Merchants (FCMs).
Source: CFTC.gov
Related Federal Cases
- Dominick Palladinetti, Drug Smuggling, Illinois 2023 · Illinois
- Joseph Griffin-Cooke, Possession of Stolen Firearm, Iowa 2013 · Illinois
- Jevon M. Jenkins, Aiding and Abetting Kidnapping, Illinois 2012 · Illinois
- Steven L. Carson, Firearm Possession, Illinois 2012 · Illinois
- Dan Stephen Daniels, Receiving and Possessing Child Pornography, Illinois 2015 · Illinois
MORE FEDERAL CRIME NEWS
US NewsUS NewsUS NewsUS News