CFTC secures $2.5m judgment against operator of fraudulent commodity pool scheme

Maria Nikolova

The order requires Richard D. Carter, principal of Blue Guru, to pay restitution totaling $838,642 and a civil monetary penalty of $1.76 million.

The United States Commodity Futures Trading Commission (CFTC) has just announced that it has obtained a $2.5 million order against Richard D. Carter in connection with a $1.76 million commodity pool fraud operated by Blue Guru, LLC. The Northern District of Illinois entered a Consent Order for Permanent Injunction on January 8, 2020, against Carter.

According to the order, Carter will have to pay restitution totaling $838,642 and a civil monetary penalty of $1,760,022. The order also imposes permanent trading and registration bans on Carter and prohibits him from violating provisions of the Commodity Exchange Act (CEA).

Let’s recall that, on January 12, 2018, the CFTC charged Carter, co-defendant Mark R. Slobodnik, and Blue Guru, LLC with fraud, misappropriation, and failing to register with the CFTC.

The order finds that from April 2014 to January 2018, Carter misrepresented material facts to Blue Guru pool participants and prospective pool participants concerning the profitability of their participation interests in the commodity pool. Carter misleadingly claimed that pool funds would be used to trade futures, including the Dow Jones E-mini and the S&P 500 E-mini contracts on the CME, but, in reality, the defendants used less than two-thirds of the $1.76 million they received for trading.

Carter also informed prospective participants that they would earn 8% per year on their investment plus 50% of any gross net trading profits, and he issued false account statements reflecting illusory quarterly gains. In fact, Blue Guru incurred more than $500,000 in trading losses, half of which Carter directly caused.

Further, the order finds that Carter misappropriated $586,674 of participants’ funds, ignored withdrawal requests, and lied about conditions that purportedly prevented defendants from making disbursements.

On November 13, 2018, the court entered a consent order of permanent injunction against defendant Slobodnik, requiring him to pay restitution of $280,000, disgorgement of $45,342, and a civil monetary penalty of $45,342. On May 1, 2018, a default judgment was entered against Blue Guru, ordering it to pay restitution of $1.4 million, disgorgement of $1.4 million, and a civil monetary penalty of $4.2 million.

On August 27, 2019, Carter pleaded guilty to wire fraud in a related criminal proceeding. He is scheduled to be sentenced on February 13, 2020.

Unfortunately, orders requiring repayment of funds to victims may not result in the recovery of any money lost because the wrongdoers may not have sufficient funds or assets.

Read this next


BlockDAG Transforms Crypto Mining with X1 Beta App Launch, Raises $49.2M in Presale; SEI & BONK Developments

Uncover BlockDAG’s X1 app beta launch, reshaping mobile mining and propelling its presale to $49.2M, eclipsing BONK and SEI.

Digital Assets

Joe Biden’s campaign explores crypto donations via Coinbase

U.S. President Joe Biden’s campaign is in discussions with cryptocurrency industry players about accepting crypto donations through Coinbase Commerce, sources familiar with the matter told The Block.


VGX Foundation and Honeyland Partner to Offer VGX Rewards for Players

The VGX Foundation has announced a partnership with popular web3 game Honeyland, offering rewards utilizing the VGX token for their players.

Digital Assets

Terraform and Do Kwon fined $4.5 billion to settle with SEC

Terraform Labs and its co-founder Do Kwon have reached a final settlement with the U.S. Securities and Exchange Commission (SEC) regarding a fraud case, according to a court filing on Wednesday.

Retail FX

Dukascopy broadens CFD offering with Italian stocks

Switzerland’s forex bank and broker, Dukascopy has just expanded its offering to include Italian stocks and the Italy 40 Index. The new additions allow clients to access a broader range of investment opportunities in the Italian market.

Fundamental Analysis, Market News, Tech and Fundamental

Global FX Market Summary: Federal Reserve Monetary Policy, US Inflation,Eurozone June 12 ,2024

The Fed meets today to decide on interest rates. A dovish shift (keeping rates steady or hinting at cuts) is expected, weakening the US dollar and potentially boosting gold prices.


BlockDAG Leads CoinSniper Ranking as Presale Surges to $49.2M While Cardano Shows Resilience & ApeCoin Surges

Explore BlockDAG’s #1 ranking on CoinSniper listing as presale booms to $49.2M. More on ADA’s resilience & ApeCoin’s surge.

Market News, Tech and Fundamental, Technical Analysis

Gold Technical Analysis Report 12 June, 2024

Gold can be expected to rise further toward the next resistance level 2385.00, which stopped the previous minor correction B at the start of June.