WASHINGTON, DC – On August 21, 2014, the U.S. Commodity Futures Trading Commission (CFTC) announced asset freezes against Ryan Tomazin of Stamford, Connecticut, Ryan Madigan of Raleigh, North Carolina, and Randell A. Vest of Fort Myers, Florida. The freezes, issued by Chief Judge Marcia S. Krieger of the U.S. District Court for the District of Colorado on August 15, 2014, expanded a prior order from August 7, 2014, which had already frozen assets of the defendants’ holding companies: RAST Investor Group, LLC, Madigan Enterprises, Inc., and Bulletproof Vest, Inc., as well as their joint company, R2 Capital Group LLC.
The court orders also prohibit Tomazin, Madigan, Vest, and their associated companies from destroying or altering financial records. The actions stem from a CFTC enforcement action filed on August 6, 2014, alleging futures and foreign currency (forex) fraud, and misappropriation of funds.
According to the CFTC complaint, R2 Capital – owned and operated by the defendants – solicited over $2.4 million from at least four investors starting in December 2009. These funds were directed into the R2 Commercial Capital Partners I L.P. (the Commercial Pool), which initially traded forex and later shifted to E-mini S&P 500 and E-mini Dow futures contracts.
The CFTC alleges the defendants fraudulently concealed critical information from investors, including the closure of the forex account, the transfer of funds to a new futures commission merchant, the cessation of forex trading, and the switch to trading E-mini futures and securities.
The complaint further alleges that the defendants misappropriated more than $1.2 million in pool funds, illegally transferring money from R2 Capital and the Commercial Pool accounts to themselves, their holding companies, and for personal expenses. These expenses included personal travel, private school tuition, other investments, and miscellaneous costs. The CFTC seeks civil monetary penalties, restitution, rescission, disgorgement of ill-gotten gains, trading and registration bans, and permanent injunctions against further violations of federal commodities laws.
The CFTC acknowledged the assistance of the National Futures Association in this case. The case is being pursued by CFTC staff members Sophia Siddiqui, Ken Koh, Dmitriy Vilenskiy, Luke Marsh, and Paul Hayeck.
Source: CFTC.gov
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