Robert Mihailovich, Sr., Fraud, Texas 2012
ROCKWALL, TEXAS – Robert Mihailovich, Sr. of Rockwall, Texas, has been permanently barred from trading commodity futures and foreign currency after being found liable for fraudulently soliciting over $30 million from approximately 93 customers. The U.S. Commodity Futures Trading Commission (CFTC) obtained a permanent injunction against Mihailovich, Sr. and his firm, Growth Capital Management LLC (GCM), on June 26, 2012.
The court order, stemming from a CFTC complaint filed on July 27, 2010, requires Mihailovich, Sr. and GCM to collectively pay over $9.3 million. This includes $3,475,112 in restitution to defrauded customers, $389,006 in disgorgement of ill-gotten gains, and a $5,440,000 civil monetary penalty.
Court documents reveal Mihailovich, Sr. was previously convicted on federal wire fraud charges and served a 27-month prison sentence. He continued to fraudulently solicit funds while on supervised release, opening managed trading accounts with the illegally obtained money. His son, Robert Mihailovich, Jr., also faced scrutiny for failing to disclose his father’s involvement with GCM and his father’s criminal history in registration filings with the CFTC. Mihailovich, Jr. previously settled with the CFTC, receiving a $40,000 penalty and a 10-year ban from seeking registration with the agency, along with a 5-year ban on trading.
The court found Mihailovich, Sr. engaged in a pattern of willful misconduct during the discovery phase of the case. He repeatedly failed to attend hearings, ignored court orders, and refused to cooperate with the CFTC’s investigation, including failing to appear for a deposition and respond to written discovery requests. Default judgments had previously been entered against both Mihailovich, Sr. and GCM due to these violations.
The CFTC acknowledged the assistance of the U.S. Attorney’s Office for the Northern District of Texas, the Securities and Exchange Commission’s Fort Worth Regional Office, and the National Futures Association in bringing this case to a resolution.
Source: CFTC.gov
Source: https://www.cftc.gov/PressRoom/PressReleases/6299-12