How do you get wealthy? Atlanta resident Arthur Toole III said he knew the way. His burning desire, his website says, is to "destroy the barriers between you and your wealth."
What he destroyed, a federal agency says, were investments by people who followed his advice. They are out more than $293,000, the Commodity Futures Trading Commission said Thursday.
Through his companies Billionaire Investor Group, The Toole Group and Catalyst Traders, Toole operated commodity pools, where investors combine their money and trade in futures contracts and commodities. But Toole spent more than $244,000 from the pools for personal expenses and costs not related to trading, the agency said.
It charged him with fraudulent misrepresentations, misappropriating commodity pool funds and other violations. To settle the charges, Toole and his companies were fined $200,000 and required to pay the $293,000 back to investors.
But they might not see that money again, CFTC said in its announcement of the settlement. "The CFTC cautions that orders requiring repayment of funds to victims may not result in the recovery of any money lost because the wrongdoers may not have sufficient funds or assets," the announcement said.
The order also bans Toole and his companies from entering any future transactions involving commodity interests and from registering with the CFTC.
It's unclear how many investors were affected. The CFTC said that most of the pools Toole operated had fewer than 15 participants.
CFTC offers tips on spotting possible fraud involving commodity pools. These are some signs to be cautious:
- The adviser claims to know unique market trends or have a record of highly profitable trading
- He promises quick, large and guaranteed returns
- Sales pitches are made through word of mouth referrals or from emails from friends, relatives, church members or social groups. One fraudulent pool operator even solicited his cancer support group, CFTC says.
- You are requested to provide cash immediately.