Federal Court Penalizes Individual for Fraud and Unauthorized Swaps Trading

The CFTC announced that the U.S. District Court for the Western District of Missouri entered a Consent Order (the "Order") against a former risk management consultant. The Order imposes a civil monetary penalty for fraud and unauthorized trading in swaps and permanently bans the individual from registering with the CFTC.

The Order resolves a CFTC enforcement action filed in September 2014, which found that the individual, who was employed as a risk management consultant at a futures commission merchant ("FCM"), engaged in fraud and unauthorized swaps trading when he knowingly executed 30 unauthorized swap transactions on behalf of one of the FCM's customers.

In addition to imposing a permanent ban, the Order requires the individual to pay a penalty of over $1.2 million for his actions.

See: Consent Order; Press Release.Related news: CFTC Charges Former Risk Management Consultant with Unauthorized Trading and Concealing Trading Losses (September 25, 2014).