AlphaMetrix Settles with CFTC for $5.6 Million, Unlikely to Ever Be Paid

Former US Commodity Pool Operator and Commodity Trading Advisor, AlphaMetrix LLC, has agreed to pay $5.6 million in restitution and civil monetary penalties in relation to using money the company owed fund managers and investors to prop up the firm’s ailing finances last year, according to the U.S. Commodity Futures Trading Commission (CFTC CFTC The 1974 Commodity Exchange Act (CEA) in the United States created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud, and abuse trade practices and promotes fairness in futures contracts. The CEA also included the Sad-Johnson Agreement, which defined the authority and responsibilities for the monitoring of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commiss The 1974 Commodity Exchange Act (CEA) in the United States created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud, and abuse trade practices and promotes fairness in futures contracts. The CEA also included the Sad-Johnson Agreement, which defined the authority and responsibilities for the monitoring of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commiss Read this Term).

Last year, the National Futures Association shut the company down, while the CFTC obtained a restraining order and an injunction on the company’s assets. The firm operated closet 90 pools with about $700 million of assets under management as of August 2013.

The CFTC allegations alleged that between January and August last year, the firm failed to reinvest at least $2.8 million of funds owed to participants.

According to the court filings, made by the federal receiver appointed to liquidate the company’s assets and repay investors, fund managers and creditors of the company, the firm already owes $3.5 million in rebates to investors and $7.2 to fund managers.

The civil lawsuit filed by the court-appointed receiver is still pending in the Northern District court of Illinois. The receiver is looking to recover funds from former executives of AlphaMetrix and its parent company AlphaMetrix Group.

The Settlement Settlement Settlement in finance refers to the process when a buyer makes payment and receives the agreed-upon services or goods. The term is used on exchanges such as New York Stock Exchange (NYSE) when security changes hands. When the asset is transferred and placed in the new buyer's name, it is considered settled. This process could take a few hours or several days after a trade is made. It depends on the clearance process. In the United States, the settlement date for marketable stocks is usually 2 Settlement in finance refers to the process when a buyer makes payment and receives the agreed-upon services or goods. The term is used on exchanges such as New York Stock Exchange (NYSE) when security changes hands. When the asset is transferred and placed in the new buyer's name, it is considered settled. This process could take a few hours or several days after a trade is made. It depends on the clearance process. In the United States, the settlement date for marketable stocks is usually 2 Read this Term with the CFTC includes $2.8 million for restitution and $2.8 million for civil monetary penalties.