Scottsdale, Arizona resident Thomas L. Hampton was hit with a hefty penalty and lifetime trading ban after a default judgment was entered against him by the U.S. District Court for the District of Arizona on January 23, 2014. Judge H. Russel Holland ordered Hampton to pay a $1.5 million civil monetary penalty for operating a fraudulent commodity pool.
The case, brought by the U.S. Commodity Futures Trading Commission (CFTC), originally filed a complaint on June 11, 2013, alleging Hampton acted as an unregistered Commodity Pool Operator (CPO) and issued false account statements. Hampton has never been registered with the CFTC.
From approximately September 2010 through September 2011, Hampton operated Hampton Capital Markets, LLC, soliciting approximately $5.2 million from at least 72 investors. The funds were intended for trading commodity futures, including E-mini S&P 500 and E-mini Dow contracts, and securities-based index products. However, the CFTC found that Hampton misrepresented the pool’s performance, providing false statements claiming significant profits when, in reality, the pool consistently incurred monthly losses.
This civil enforcement action is in addition to a criminal conviction. On April 19, 2013, Hampton pleaded guilty to one count of commodities fraud in the United States District Court for the Southern District of New York (Case No. 13-cr-00301-RWS). He was sentenced in October 2013 to 30 months in prison and ordered to pay over $4.8 million in restitution to his victims.
The CFTC acknowledged the assistance of the Arizona Corporation Commission, Securities Division, and the U.S. Attorney’s Office for the Southern District of New York in pursuing the case. The agency encourages anyone with information about potential commodity trading fraud to contact them via their toll-free hotline or online complaint form.
Source: CFTC.gov
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