Washington, D.C. – W Resources, LLC, a Dallas, Texas-based firm, has been ordered to pay a $150,000 penalty by the U.S. Commodity Futures Trading Commission (CFTC) for operating as an unregistered Commodity Pool Operator (CPO). The order, issued September 5, 2017, also mandates that W Resources cease and desist from further violations of the Commodity Exchange Act (CEA).
The CFTC found that W Resources managed three commodity pools – W North Fund LLC, W North Fund II LLP, and W North Fund III LLP (collectively, the W North Funds) – by trading commodity options related to oil and gas assets. Beginning in October 2013, the company operated these funds without registering with the CFTC as a CPO, a direct violation of federal regulations.
Furthermore, the investigation revealed that W Resources failed to file a notice of exemption with the National Futures Association (NFA) or seek any other form of relief from CFTC oversight. This lack of registration and notification constitutes a significant breach of regulatory compliance designed to protect investors and maintain market integrity.
As part of the agreement with the CFTC, W Resources is required to maintain any existing commodity positions until their expiration. The firm is prohibited from entering into any new commodity interest transactions until it either registers with the CFTC, obtains an applicable exemption from registration and notifies the NFA, or secures no-action relief from the agency.
The CFTC’s enforcement team included David W. Oakland, Steven Ringer, Lenel Hickson, and Manal Sultan. This case highlights the CFTC’s commitment to ensuring all commodity pool operators comply with registration requirements and operate within the bounds of the law.
Source: CFTC.gov
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