A Florida federal judge banned a metals trader and his defunct firm from commodities trading and fined them
$3 million for allegedly conducting illegal, off-exchange transactions with retail customers on borrowed money, the U.S. Commodity Futures Trading Commission (CFTC) said Wednesday.
The default judgement order, issued today by Judge William P. Dimitrouleas of the U.S. District Court for the Southern District of Florida, follows a CFTC complaint filed in February 2016 against Joseph Charles DiCrisci and his firm Oakmont Financial Inc. alleging numerous violations.
The order requires Joseph and the firm to pay a $2,205,987 civil monetary penalty and disgorge $735,329 in ill-gotten gains. Additionally, it imposes permanent trading and registration bans against DiCrisci and Oakmont.
Changing the Face of AML with Self Service AnalyticsGo to article >>
Judge Dimitrouleas’s order also prohibits DiCrisci and Oakmont from violating the Commodity Exchange Act and CFTC regulations as charged in the February’s complaint. His order follows a CFTC investigation on the matter filed on January 12, 2016, which noted that DiCrisci and Oakmont repeatedly engaged in illegal, off-exchange precious metals transactions on a leveraged, margined or financed basis.
The complaint claims that from July 2011 and continuing through to at least July 2012, DiCrisci and Oakmont, by and through its employees, illegally solicited retail customers by telephone to buy physical precious metals on a leveraged, margined or financed basis. But the commodities watchdog alleged that Oakmont’s customers never took delivery of the metals.
The same complaint found that DiCrisci and Oakmont acted as an FCM without being so registered.
The CFTC noted that, under the Dodd-Frank law, off-exchange leveraged, margined or financed transactions are illegal unless they result in actual delivery of metal within 28 days. However, the regulator found that precious metals were never delivered to the customers by DiCrisci and Oakmont.