New York, NY – Otmane El Rhazito, a former Vice President for Citigroup Global Markets Limited in the U.K., has been ordered to pay over $1.49 million in restitution and penalties for fraudulent trading practices, the Commodity Futures Trading Commission (CFTC) announced August 8, 2011.
A federal court default judgment, entered on July 29, 2011, by Judge Denise Cote of the U.S. District Court for the Southern District of New York, requires El Rhazito to pay $373,860 in restitution to Citibank, N.A. He also faces a $1,121,580 civil monetary penalty. The order permanently bans El Rhazito from engaging in futures trading and registering with the CFTC.
The CFTC initially filed a complaint against El Rhazito on April 15, 2011, alleging noncompetitive trading, fraud, and misappropriation of funds. Investigators determined that the Moroccan national engaged in a scheme to steal money from a Citibank proprietary account while employed by Citigroup Global Markets Limited.
According to the court’s findings, beginning November 23, 2010, El Rhazito executed a series of fictitious and noncompetitive palladium and platinum futures transactions on the New York Mercantile Exchange. These trades were designed to transfer funds from the Citibank account to his personal account without any actual change in open positions. The fraudulent activity resulted in a $373,860 loss for Citibank and a corresponding profit for El Rhazito’s personal account.
The CFTC acknowledged the assistance of the U.K. Financial Services Authority and the National Futures Association in the investigation.
Source: CFTC.gov
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