CFTC Sues Alleged Commodity Hedge Fund Fraudster

Mar 31 2010 | 2:33am ET

While a cadet at the U.S. Military Academy, Enrique Villalba was subject to a strict honor code. According to the Commodity Futures Trading Commission, he left that honor code at West Point.

The regulator has alleged that Villalba’s commodity futures hedge fund, Money Market Alternative, was nothing more than a Ponzi scheme. In a complaint filed this week, the CFTC accuses Villalba of defrauding investors of $37.5 million from at least 1996 through November.

Villalba misappropriated some at least $10 million of that money, according to the complaint, using more than $7 million to make Ponzi-style payments to investors and at least $3 million to finance his coffee business, buy real estate and on other expenses. Of the $23.2 million he did invest, he lost $17 million, according to the CFTC.

To hide those massive losses, Villalba allegedly told clients the fund was consistently making money, in at least one case using phony commission merchant statements to show off his profitable trades.

The CFTC is seeking restitution, disgorgement and penalties against Villalba and Ohio-based MMA.


In Depth

Q&A: Pantheon’s McCrary Says Private Equity Market ‘Robust’

Dec 17 2014 | 8:32am ET

Dennis McCrary is a partner at Pantheon, a private equity firm with $32.2 billion...

Lifestyle

Cohen Donates $1.5M To GOP Governors Association

Dec 10 2014 | 7:13am ET

The Republican Governors Association raised close to $25 million from October 1...

Guest Contributor

Q&A With Daniel Gallancy: Institutional Interest In Bitcoin Is Growing Steadily

Dec 12 2014 | 7:54am ET

Daniel Gallancy is founder and CEO of SolidX, a provider of total return swaps for...

 

Sponsored Content

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

December 2014 Cover

Futures 2014 person of the year

Jeff Sprecher was simply looking for a platform to trade energies when launching ICE 14 years ago but it has grown to reach the pinnacle of both the listed futures and equities world.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.