Robert D. Bame of Moreno Valley, California, has been ordered to pay over $46.9 million in restitution and penalties for running a commodity pool fraud, according to a federal court order obtained by the U.S. Commodity Futures Trading Commission (CFTC). The order, entered by Judge R. Gary Klausner of the U.S. District Court for the Central District of California on March 3, 2011, requires Bame to pay $16,038,568.68 in restitution and a $30,887,006 civil monetary penalty.
The CFTC initially filed a complaint against Bame and his firm, Forward Investment Group, LLC, on August 26, 2008, alleging that they provided forged and false commodity trading statements to investors. These statements falsely indicated that the defendants managed millions of dollars, while they had actually misappropriated the majority of the $20 million invested by participants.
Judge Klausner previously found, in a permanent injunction order on March 18, 2010, that Bame and Forward violated anti-fraud provisions of the Commodity Exchange Act. This included sending investors false updates about their investments and providing fabricated account statements. The court determined Bame diverted approximately $19 million of investor funds, using it to pay off other investors or for personal expenses, including luxury items like automobiles and private jet travel.
In a related criminal case, Bame pled guilty to wire fraud and engaging in monetary transactions with illegally obtained funds on May 29, 2009. He received a 97-month prison sentence and was also ordered to pay $16,038,568.68 in restitution – matching the amount stipulated in the CFTC order. The CFTC acknowledged the assistance of the National Futures Association, the U.S. Attorney’s Office for the Central District of California, and the Federal Bureau of Investigation in the investigation.
Source: CFTC.gov
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