Matthew L. Hall of West Palm Beach, Florida, has been charged with precious metals fraud by the U.S. Commodity Futures Trading Commission (CFTC), according to an order filed on September 4, 2013. Hall operated under the name Pacific Exchange Group (PEG), a telemarketing firm with a virtual office in Henderson, Nevada.
The CFTC alleges that from late April 2012 through February 2013, Hall illegally solicited retail customers for financed precious metals transactions executed off-exchange. He and his employees reportedly misrepresented the transactions to customers, claiming they could purchase physical gold, silver, copper, platinum, or palladium with only a 20% down payment, financed with interest-bearing loans. Customers were told the metals would be stored in their name at an independent depository.
However, the CFTC found that Hall simply passed customer orders and payments to Hunter Wise Commodities, LLC, without disclosing Hunter Wise’s involvement to customers. Hall received commissions and fees totaling $202,577 from Hunter Wise. Crucially, the CFTC alleges that neither Hall nor Hunter Wise ever purchased, sold, loaned, stored, or transferred any physical metals, and no precious metals were ever delivered to customers.
As part of the settlement, Hall is required to pay $202,577 in restitution to his customers. He is also permanently banned from registering with the CFTC and trading commodities. The CFTC previously filed a lawsuit against Hunter Wise in federal court in Florida on December 5, 2012, alleging similar illegal activity, fraud, and other violations. A preliminary injunction was issued against Hunter Wise on February 25, 2013, freezing the firm’s assets and appointing a corporate monitor.
Neither Hall nor PEG were registered with the CFTC, a requirement for legally conducting financed commodity transactions with retail customers.
Source: CFTC.gov
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