Louis J. Ferone, of Miami, Florida, has been ordered to pay $55,442 in restitution to customers and a $100,000 civil penalty for conducting illegal precious metals transactions, the Commodity Futures Trading Commission (CFTC) announced on September 25, 2014.
Ferone operated Bentley Metals LLC, a Delaware-based company with its primary business location in Hoboken, New Jersey. The company ceased operations around September 2012. Between at least July 16, 2011, and September 2012, Bentley Metals allegedly solicited retail customers through telemarketing and a website to participate in financed, off-exchange precious metals transactions.
The CFTC’s order states that Bentley Metals collected $55,442 in commissions and fees from 17 illegal, leveraged metals transactions. The company acted as a Futures Commission Merchant (FCM) without being registered with the CFTC, a violation of federal regulations.
According to the CFTC, Ferone was the sole owner of Bentley Metals and maintained complete control over its operations. This included exclusive access to the company’s bank accounts, as well as the hiring, supervision, and payment of all employees, including the telemarketing staff.
The CFTC advises potential victims that restitution orders do not guarantee the recovery of lost funds, as the defendant may lack sufficient assets. The agency stated it will continue to pursue enforcement actions to protect customers and hold perpetrators accountable.
The case was led by CFTC Division of Enforcement staff members Patrick Daly, Michael C. McLaughlin, Patryk J. Chudy, David W. MacGregor, Lenel Hickson, Jr., and Manal M. Sultan.
Customers who believe they may have been affected by this fraud are encouraged to report suspicious activity to the CFTC via its toll-free hotline at 866-FON-CFTC or submit a tip online.
Source: CFTC.gov
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