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Screenshot of a breaking news alert e-mail from Q2 2017
The U.S. Commodity Futures Trading Commission (CFTC) has announced that Judge J. Paul Oetken of the U.S. District Court for the Southern District of New York entered an Opinion and Order (Order) against Defendants Gary Creagh and Wall Street Pirate Management, LLC (Wall Street Pirate), both of New York, New York. The Order, entered on May 10, 2017, permanently prohibits the Defendants from registering with the CFTC in any capacity and engaging in any commodity interest trading, and it requires Defendants to pay a $125,000 civil monetary penalty. Also, the court entered a supplemental Order on June 16, 2017, that permanently bans Defendants from trading for themselves or on behalf of any other person or entity.
The Order stems from a CFTC Complaint filed on August 5, 2015 (see CFTC Press Release 7210-15) and a Consent Order for permanent injunction against Creagh and Wall Street Pirate, which was entered by the Court on April 25, 2016 (April Order). The Complaint charged, and the April Order found, that Creagh and Wall Street Pirate made false statements to the National Futures Association (NFA) in statutorily required reports and during an NFA audit, in violation of the Commodity Exchange Act (CEA). Both Wall Street Pirate and Creagh, the managing member and sole employee of Wall Street Pirate, were registered with the CFTC at the time of the conduct.
In addition, the CFTC Complaint charged, and the April Order found, that from December 2011 through September 2013, Creagh willfully made multiple false statements to the NFA and concealed material information from the NFA. Specifically, the Complaint charged, and the April Order found, that on multiple occasions Creagh falsely represented to the NFA that the commodity pool he operated on behalf of Wall Street Pirate was not active, despite the fact that he had accepted funds from pool participants and actively traded commodity futures on behalf of the commodity pool. In addition, the Complaint charged, and the April Order found, that Wall Street Pirate, by and through Creagh, failed to maintain required books and records and provide account statements and privacy notices to pool participants.
James McDonald, Director of the CFTC’s Division of Enforcement stated:
The Commission often relies on self-regulatory organizations like the NFA as a first line of defense to help protect customers and preserve the integrity of the markets. But for that to work, we must be confident that the NFA is getting true and accurate information. This action, together with the Court’s order, shows that lies to the NFA – just like lies to the Commission – will not be tolerated.
The NFA is a Chicago-based futures association, which is registered with the CFTC and serves as the industry’s self-regulatory organization. Pursuant to the CEA, the NFA is responsible, under CFTC oversight, for certain aspects of the regulation of futures entities and their associated persons.