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Screenshot of a breaking news alert e-mail from Q2 2017
Sentenced to prison alongside his associates Robert J. Cannone and Francis Franco
The US regulator CFTC has issued a statement announcing that it it obtained a court order against the principal of National Equity Holdings Thomas B. Breen for $1.75 mln, related to his fraudulent activities of solicitation, misappropriation of the firm’s customers’ funds and registration violations. A restitution order of $1.05 mln was related to a criminal action and additional $700,000 are for a civil monetary penalty.
Between June 2009 and May 2010 Mr. Breen has acknowledged to have fraudulently solicited and accepted from investors more than $1.4mln for trading a commodity futures pool through his company National Equity Holdings. He mislead investors to believe that there was an experienced and successful trader on his team (Francis Franco) and promised excessive returns without disclosing the risks associated with the venture.
The company traded only a portion of the funds obtained and registered substantial losses during the endeavor. It seems that tapered account statements are becoming the norm and standard practice for such companies, so the fraud was concealed from the investors. About a year later the party has informed their clients that their funds have been lost in trading.
The promise to return the funds did not satisfy the victims and they sought their rights in court. The associates of Mr. Breen – Robert J. Cannone and Francis Franco pled guilty on criminal charges and were sentenced to 27 and 25 months accordingly. A hefty fine was imposed on Mr. Cannon totaling $1.05 mln in restitution, while Breen was sentenced to 40 months in prison.
A hefty price tag for the trio of fraudsters, and another case in which it seems that falsifying an account statement is a piece of cake. We advise our readers to be vigilant and always check the companies’ registration with corresponding regulators.
Following is a link to the full press release on CFTC’s website.
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