Florida-Based Fraudsters Get Stung with $8 Million Penalty and Sanctions

A federal court in Florida has issued an Order against two fraudsters resulting in financial penalties and sanctions exceeding $8

download (22)Florida-based fraudsters were found guilty by a federal court for running a phony commodity pool scheme. Judge Gregory A. Presnell of the U.S. District Court for the Middle District of Florida, issued a permanent trading and registration ban against Philip Leon and Paul Rangel, in addition the two were issued a monetary penalty and sanctions of over $8 million.

The main financial watchdog that supervises derivatives markets in the US, the Commodity Futures Trading Commission (CFTC), obtained federal court Orders requiring Defendants Philip Leon, of Altamonte Springs, Florida, to pay a $4 million civil monetary penalty and $1,598,343 in disgorgement and Paul Rangel, of Apopka, Florida, to pay a $1.7 million civil monetary penalty and $819,781 in disgorgement to settle CFTC charges related to a fraudulent commodity pool scheme.

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The federal court Order comes seventeen months after the CFTC charged the two mentioned above along with John Wilkins and their company Altamont Global Partners LLC with fraud and misappropriation.

Details of the case show that the trio were running a commodity pool scheme that solicited at least $18 million from approximately 241 commodity pool participants to trade in a range of asset classes including; commodity futures contracts, options on futures, and off-exchange foreign currency contracts.

Furthermore, the Orders further find that Leon and Rangel misappropriated a combined total of more than $2.4 million of pool participants’ funds and issued false statements to pool participants regarding the profitability and value of their accounts. Specifically, Leon misappropriated nearly $1.6 million and Rangel nearly $819,000 of pool participants’ funds as “loans” and “advances” from the commodity pools, designed to disguise their misappropriation.

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