CFTC wins federal judgment against Texas commodity pool Ponzi schemer Richard Theye

The CFTC announced late yesterday that it attained a federal default judgment order against Richard Theye. Theye is required to pay over $6.2 million in restitution and civil monetary penalties for operating his company Micind Capital Management as a multi-million dollar commodity pool Ponzi scheme. The CFTC brought charges against Theye and Micind Capital about a year ago.

The order finds that since December 2005, Theye had been fraudulently soliciting members of the public to invest millions (including 401(k)s, IRAs, and pensions) in his two commodity pools, RYCO Group and First RYCO (the RYCO pools). Investments were often raised at meetings in Theye’s own Austin church, or through advertisements that falsely represented the RYCO commodity pools’ past profits.

Instead of investing the funds, the vast majority of participants’ money was used to make Ponzi “profit” payments to earlier commodity pool participants. Theye’s efforts at futures trading resulted in hundreds of thousands in losses. To keep the scheme going, he doctored account statements to show profits where there were none.

The CFTC filed a 13-count criminal indictment, and Theye pled guilty to nine in July of 2010. He has been serving a 144 month sentence in California. In addition to $5.7 million in restitution and over half a million in civil monetary penalty, he is banned from ever engaging in commodity-related activities or registering with the CFTC.

Read more about this CFTC enforcement action.

Creative Commons License photo credit: puamelia

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