Court freezes assets of Chicago commodity pool in USD1m anti-fraud case

Court freezes assets of Chicago commodity pool in USD1m anti-fraud case

The US Commodity Futures Trading Commission has obtained an emergency court order freezing assets held by defendants Raleigh Capital Management of Chicago and its sole principal, Richmond Hamilton, Jr., who resides in Morocco.

The court’s order also prohibits the destruction of records and appoints a receiver to identify assets, customers and amounts owed customers.

The emergency order stems from a CFTC complaint filed on 28 October 2009, in the US District Court for the Northern District of Illinois, charging RCM and Hamilton with misappropriating more than USD1m since May 2004 from the Raleigh Fund, a USD8.3m commodity pool organised by Hamilton in 1987.

The CFTC complaint also charges Hamilton with making false statements to the National Futures Association.

RCM, an Illinois corporation and general partner of the Raleigh Fund, is registered with the CFTC as a commodity pool operator, and Hamilton is registered as its associated person.

According to the CFTC complaint, Hamilton and RCM made repeated cash withdrawals from the Raleigh Fund to pay personal expenses, purchase and maintain an airplane and lease a car in the US for Hamilton.

Additionally, the CFTC alleges that Hamilton engaged in a sham real estate transaction to siphon funds from the Raleigh Fund. The CFTC also alleges that Hamilton made a false statement to investors regarding the payment of interest on certain personal loans from the Raleigh Fund and failed to disclose that he had stopped making payments on the principal balance of the loans.

Hamilton also made false statements to the NFA in the course of the NFA’s audit of the Raleigh Fund about the extent of his personal bank accounts and his administration of the Fund, the complaint charges.

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