CFTC imposes more than $1m in penalties on M.W. Global Futures and its head Matthew R. White
The regulator filed and settled charges against White and MWGF for fraudulently soliciting $1.2 million for a pooled investment vehicle trading commodity futures contracts.
The United States Commodity Futures Trading Commission (CFTC) today issued an order simultaneously filing and settling charges against Matthew R. White and his company M.W. Global Futures LLC (MWGF) for fraudulently soliciting approximately $1.2 million for a pooled investment vehicle trading commodity futures contracts, misappropriating over $280,000 in pool participants’ funds to pay for personal expenses, and operating without registration.
According to the Order, White and MWGF will have to pay a $200,000 civil monetary penalty and $883,974 in restitution, of which $602,003 has already been paid. The Order also requires White and MWGF to cease and desist from further violations of the Commodity Exchange Act.
The Order finds that from at least February 2014 to July 2018, White and MWGF solicited and received funds from at least six pool participants residing in Florida and Washington state, for the purpose of trading commodity futures contracts. White pooled the participants’ funds in his personal bank and trading accounts and deposited only a portion of the pooled funds into commodity interest trading accounts.
From 2014 to 2018, White traded pool participants’ funds in two commodity interest accounts, both in his own name. In the first account, there were at least 31 months in which no trading occurred, and the account was closed with a total cumulative loss of $687. In the second account, opened in April 2018, trading occurred in only one month and ended with a cumulative loss of $308.
White made false or misleading statements and omitted material facts regarding the profitability of his commodity futures trading to prospective and current pool participants.
The order further finds that White misappropriated $281,970 of pool participants’ funds, diverting most of it for personal expenses, including credit card, auto loan, and rent payments.
Of the approximately $1.2 million collected from pool participants, MWGF and White initially repaid more than $400,000, and during the CFTC’s investigation, White repaid an additional $602,003 to pool participants.
The order also finds that in soliciting and holding funds for a pooled investment vehicle trading commodity futures contracts, White and MWGF illegally operated as unregistered commodity pool operators and White illegally acted as an unregistered associated person of MWGF.
In a separate action brought by the U.S. Attorney’s Office for the Western District of Washington, White pleaded guilty to one count of wire fraud in connection with fraudulent solicitation and misappropriation of funds from investors. He is set to be sentenced on April 10, 2020.