The US Commodity Futures Trading Commission (CFTC) has obtained federal court orders requiring Rodney W Whitney of Thomasville, North Carolina, Nicholas T Cox of Denton, North Carolina, and Integra Capital Management, LLC (Integra), which formerly operated out of High Point, North Carolina, to pay over USD6.9 million in restitution, disgorgement, and civil monetary penalties.
The orders, entered against Cox on 27 October, 2011 and against Whitney and Integra on 13 October, 2011, find that they defrauded investors in a commodity pool Ponzi scheme involving commodity futures and off-exchange foreign currency transactions.
The orders, entered by US District Judge Thomas D. Schroeder of the US District Court for the Middle District of North Carolina, stem from a CFTC complaint filed in September 2010, charging Whitney, Cox, and Integra with fraud and misappropriation in connection with the scheme.
The orders require Whitney and Integra jointly and severally to pay restitution of USD2,185,063, disgorgement of USD1,198,316, and a civil monetary penalty of USD3,594,948 and require Cox to pay restitution of USD2,185,063 and a USD2,185,063 civil monetary penalty. The orders provide for a dollar-for-dollar credit for Whitney, Cox, and Integra for any restitution or civil monetary penalty payments paid by the other party. The orders also permanently prohibit Whitney, Cox, and Integra from engaging in any commodity-related activity, including trading, and from registering or seeking exemption from registration with the CFTC.
Judge Schroeder found that, beginning in or about September 2006 and continuing through at least August 2009, Whitney, Cox, and Integra violated the anti-fraud provisions of the Commodity Exchange Act (CEA) by misrepresenting Integra’s trading performance and by misappropriating pool participants’ funds, among other violations.
