AUSTIN, TX – Richard D. Theye, 61, of Austin, Texas, is facing federal charges of fraud following a complaint filed by the U.S. Commodity Futures Trading Commission (CFTC) on June 21, 2010. The CFTC alleges that Theye orchestrated a multi-million dollar Ponzi scheme through his company, Micind Capital Management, Inc., and two commodity pools, RYCO Group, LLC and First RYCO, LLC.
According to the complaint, beginning in December 2005, Theye fraudulently solicited investments from the public, including encouraging investors to liquidate retirement funds like 401(k)s and IRAs, to invest in the RYCO pools. He allegedly made false claims about the pools’ historical profits in both personal meetings at his church and in advertising materials.
The CFTC alleges that Theye misappropriated the majority of investor funds to maintain the Ponzi scheme, paying earlier investors with money from new investors. Commodity futures trading conducted by Theye reportedly resulted in substantial losses – hundreds of thousands of dollars since 2006 – but he concealed these losses by issuing fictitious account statements showing fabricated profits.
The complaint further details a separate fraudulent scheme involving a Micind investor. Theye allegedly agreed to trade on the investor’s behalf in exchange for a capital contribution, but never executed the trades. Instead, he issued false statements of profitable trading and diverted the investor’s funds to fuel the larger Ponzi scheme.
The CFTC is seeking restitution, disgorgement of ill-gotten gains, civil monetary penalties, trading and registration bans, and a permanent injunction against Theye to prevent further violations of federal commodities laws. A hearing on the CFTC’s motion for a Statutory Restraining Order to freeze assets and compel a full accounting of funds is scheduled for July 9, 2010.
The CFTC acknowledged the assistance of the U.S. Attorney’s Office for the Western District of Texas, the Federal Bureau of Investigation, and the Texas State Securities Board in this investigation.
Source: CFTC.gov
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