CFTC court order imposes over $9 million penalty in Louisiana forex fraud case

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Louisiana forex fraud penalty

Highlights

The U.S. District Court for the Eastern District of Louisiana imposed a civil monetary penalty exceeding $9 million on DePetrillo, Meteor LLC, and NOLA FX Capital Management LLC for a $3 million retail forex fraud.
The court found defendants misappropriated participant funds, operated a Ponzi-like scheme, issued false statements, and imposed permanent trading, registration bans, and an injunction against future violations.
In a related criminal case, DePetrillo received a nine-year prison sentence and was ordered to pay $6,748,412 restitution on July 23, 2025.

Court findings and enforcement measures

As announced by the Commodity Futures Trading Commission, the U.S. District Court for the Eastern District of Louisiana entered a default judgment against DePetrillo, Meteor LLC, and NOLA FX Capital Management LLC over their roles in a fraudulent retail forex scheme.

The court found the defendants fraudulently solicited and misappropriated more than $3 million from participants. It also found they falsely told participants that the money would be used for retail forex trading, made material misrepresentations and omissions about the profitability of trading with them, and issued false account statements to conceal the misconduct.

The court further found that participant money was diverted to make payments to existing participants in a manner akin to a Ponzi scheme, to cover DePetrillo's personal expenses, and to trade in DePetrillo's personal account. In addition to the civil monetary penalty, the order permanently enjoins the defendants from further violations of the Commodity Exchange Act and Commission regulations, and imposes permanent trading and registration bans.

Criminal case and broader regulatory impact

The default judgment resolves all claims in the CFTC's 2024 complaint, closing the agency's civil case over the conduct described in the filing. The action adds to a broader U.S. enforcement push against fraud in retail foreign exchange markets, where regulators continue to focus on misrepresentations, misuse of customer funds, and false performance reporting.

In a related criminal case, DePetrillo pleaded guilty on Feb. 18, 2025 to violating the Commodity Exchange Act in connection with the same conduct. On July 23, 2025, the court sentenced him to nine years in prison and ordered him to pay $6,748,412 in restitution.

The CFTC also said it received assistance in the matter from the U.S. Attorney's Office for the Eastern District of Louisiana and the FBI New Orleans Division.

Our earlier report on the Malaysian Court of Appeal ruling examined how a lawyer with commission-partner status at a law firm can still be treated as a “partner” under the Partnership Act 1961 and held liable for the firm’s unpaid obligations. The decision reversed lower-court findings and highlighted broader implications for how liability may extend to non-equity partners when funds are mishandled in professional transactions.

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