CFTC court order directs Texas firm, owner to pay over $13 million in commodities fraud case
A federal court in Texas has entered a default judgment against Cambridge Financial Advisors LLC and its owner Walter Dunning Larrick III over a commodities fraud scheme. The order requires more than $13 million in penalties and restitution and permanently bars the defendants from future trading and registration activity.
Highlights
- U.S. District Court for Northern District of Texas ordered Texas firm and owner to pay over $13 million for commodities fraud and trading bans.
- Defendants misappropriated more than $3 million from participants with false promises of commodity trading in natural gas, oil, and gold.
- Court judgment resolves all claims from the CFTC's 2023 complaint, highlighting sustained regulatory action against fraudulent commodity investment schemes.
Texas judgment imposes penalties and trading bans
As announced by Commodity Futures Trading Commission, the U.S. District Court for the Northern District of Texas entered the default judgment after finding the defendants participated in a scheme that fraudulently solicited and misappropriated more than $3 million from participants.The court found the defendants falsely told participants that their money would be used to trade futures and options tied to commodities including natural gas, oil and gold. It also found they made material misrepresentations and omissions about the profitability of the trading program and issued false account statements to conceal the misconduct.
The order requires the defendants to pay a civil monetary penalty of $9,767,625 and restitution of $3,255,875. It also permanently enjoins them from further violations of the Commodity Exchange Act and CFTC regulations, and imposes permanent trading and registration bans.
Case closes claims from 2023 complaint
The court further found that participant money was misappropriated to make payments to existing participants in a manner akin to a Ponzi scheme, to cover Larrick's personal expenses and to send funds to offshore accounts in Costa Rica.The default judgment resolves all claims in the CFTC's 2023 complaint, closing the agency's enforcement action in the case. The ruling underscores continued regulatory pressure on fraudulent commodity investment schemes in the U.S. retail market.
In our earlier article on the Ontario court case over shoreline work along the Sturgeon River, we explained how unauthorized excavation and construction activity led to convictions and significant fines and court-ordered payments tied to damage to endangered Lake Sturgeon habitat. The rulings underscored strict permit enforcement and rising regulatory risk for companies and contractors operating in protected conservation areas.
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