Tracy Lee Thomas, Wire Fraud, Florida 2017

A Florida man and his offshore corporation have been ordered to pay over $4.4 million in restitution and penalties for defrauding investors out of $1.1 million, the Commodity Futures Trading Commission (CFTC) announced. Judge Loretta C. Biggs of the U.S. District Court for the Middle District of North Carolina entered a default judgment against Tracy Lee Thomas, also known under multiple aliases including Treyton L. Thomas, and Marbury Advisors Inc., a Cayman Islands corporation.

The court found that between February 2011 and August 2012, Thomas and Marbury engaged in a fraudulent scheme, falsely claiming to invest customer funds in safe Treasury Bills. They misrepresented their investment success and promised conservative trading strategies. In reality, the defendants used approximately $1.189 million of customer money to trade risky Chicago Mercantile Exchange E-mini S&P 500 futures contracts and Chicago Board of Trade 2-Year Treasury Note futures contracts, failing to disclose the inherent risks or the substantial losses incurred.

The judgment requires Thomas and Marbury to jointly pay $1,110,413 in restitution and a $3,331,239 civil penalty – triple the illicit gains. Both are permanently banned from trading and registering with the CFTC, and prohibited from future violations of the Commodity Exchange Act. The scheme specifically targeted Thomas’s father-in-law, who invested $594,000 based on false promises of safe investments in T-Bills, only to have the funds used for undisclosed commodity futures trading.

Defendants further concealed their actions by providing fabricated account statements to both customers and a bank holding a trust account belonging to Thomas’s late father. This case is related to an ongoing criminal matter; Thomas was indicted in November 2016 on fourteen counts of wire fraud in the U.S. District Court for the Eastern District of North Carolina (case no. 16-CR-298). The CFTC cautioned investors that recovering funds may be difficult due to the defendants’ potentially limited assets. The agency expressed commitment to protecting customers and holding wrongdoers accountable, and thanked the Cayman Islands Monetary Authority for their assistance in the investigation.

Source: CFTC.gov

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