CFTC ACTION: David P. Lee

The CFTC announced that it has entered into consent order settling charges brought against David P. Lee of New Jersey, a former trader for the Bank of Montreal. Judge George B. Daniels of the U.S. District Court for the Southern District of New York entered an order on November 5, 2009, requiring Lee to pay a $500,000 civil monetary penalty. The order also permanently bans Lee from any commodity-related trading. The order stems from the CFTC’s complaint filed on November 18, 2008, that charged Lee with unlawfully mis-marking his natural gas options positions between at least May 2003 and May 2007 and with mis-valuing other natural gas options positions from October 2006 until May 2007. Further, the complaint charged that Lee and various brokers deceived BMO by fabricating purportedly independent broker quotes delivered to BMO’s back office for price verification. The order found that this conduct violates anti-fraud and false reporting provisions of the Commodity Exchange Act and CFTC regulations. The CFTC’s litigation against other named defendants continues.

About The Author

Felix Shipkevich

Felix Shipkevich is a Manhattan-based attorney and general counsel for Shipkevich Law Firm. He has extensive experience working with the CFTC and NFA on registration, compliance, and enforcement issues for CPOs, CTAs, FCMs, IBs, and RFEDs. Felix also practices intellectual property and corporate governance law.