PHOENIX, AZ – Ray Thomas Brown, of Phoenix, Arizona, has been permanently banned from trading and registration in commodity markets following a judgment issued by Judge Frederick J. Martone of the U.S. District Court for the District of Arizona on February 28, 2014. The ruling stems from a complaint filed by the U.S. Commodity Futures Trading Commission (CFTC) on November 26, 2012, alleging fraud, misappropriation, and registration violations.
Brown was ordered to pay $1,131,941.98 in restitution and disgorgement, as well as a $140,000 civil monetary penalty. The CFTC accused Brown of operating two separate fraudulent schemes while acting as both a Commodity Pool Operator (CPO) and a Commodity Trading Advisor (CTA).
According to the CFTC, Brown fraudulently solicited at least $1.2 million from customers, depositing only approximately $86,000 into trading accounts, which was subsequently lost. The majority of the solicited funds were allegedly used for personal expenses and to perpetuate the fraudulent scheme. Brown is accused of lying about his background, fabricating investment performance, distributing false account statements, and failing to disclose his unregistered status with the CFTC.
The court found that Brown targeted more than 200 individuals, soliciting approximately $1,163,519. In a related criminal case, Brown pleaded guilty to wire fraud on May 7, 2013, and is currently awaiting sentencing in the United States District Court for the Central District of California (Case No. 8:13-cr-00035-UA).
The CFTC acknowledged the assistance of the United States Attorney’s Office for the Central District of California, the Federal Bureau of Investigation, the Phoenix Police Department, and the Arizona Corporation Commission in the investigation.
Source: CFTC.gov
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