The Commodity Futures Trading Commission (CFTC) settled charges against a Texas company and its owner for committing fraud while acting as an unregistered commodity trading advisor (CTA) and for failing to register as a CTA.
The charges against Peter L. Bryant of Texas and his company, Bryant Capital Trade Management Corp. require them to pay, jointly and severally, $55,655.90 in restitution and a $195,000 civil monetary penalty. It also calls on them to cease and desist from any further violations of the Commodity Exchange Act (CEA) and CFTC regulations. Further, the order imposes four-year trading and registration bans on Bryant and Bryant Capital.
Starting around February 2014 and continuing through approximately December 2022, Bryant and Bryant Capital acted as unregistered CTAs through direct outreach, electronic communications, newsletters, and web-based advertisements, the CFTC said. Such solicitations offered advice regarding the value and advisability of trading in commodity options, futures, and/or swaps in energy markets and promoted paid trading advisory services.
These solicitations, according to the order, included numerous false and misleading statements regarding their business and performance, expertise and experience in the energy derivatives markets, client base, past performance, as well as the applicability of the CFTC’s registration requirements to their business.
For example, in one newsletter, they falsely represented that in 2021, they provided services to 47 clients with “proprietary – detailed analyses and made countless recommendations,” and that in 44 of these 47 analyses, their work had “identified performance markers resulting in a 27%-39% reduction in 2021 energy costs in addition to showing a minimum 5% immediate reduction in current energy costs within the first 90 days of engagement.” The CFTC said these representations were entirely fabricated. The company also falsely said their business was operating as an “exempt swap intermediary” that did not require CFTC registration.
The order finds the respondents’ misrepresentations regarding their business and services resulted in at least $55,655.90 in client losses.