{"id":83253,"date":"2022-11-30T03:23:15","date_gmt":"2022-11-30T08:23:15","guid":{"rendered":"https:\/\/www.hedgeco.net\/news\/?p=83253"},"modified":"2022-11-30T03:24:11","modified_gmt":"2022-11-30T08:24:11","slug":"cftc-charges-former-broker-with-paying-brokerage-kickbacks-and-misappropriating-nonpublic-information","status":"publish","type":"post","link":"https:\/\/hedgeco.net\/news\/11\/2022\/cftc-charges-former-broker-with-paying-brokerage-kickbacks-and-misappropriating-nonpublic-information.html","title":{"rendered":"CFTC Charges Former Broker with Paying Brokerage Kickbacks and Misappropriating Nonpublic Information"},"content":{"rendered":"\n

(HedgeCo.Net) The Commodity Futures Trading Commission has issued an order simultaneously filing and settling charges against Lee Tippett<\/strong>, a former broker with Classic Energy, LLC, for participating in a scheme to pay kickbacks to Matthew Clark, a trader employed by one of Classic\u2019s brokerage customers. The order finds Tippett made these kickback payments to Clark in exchange for Clark sending more brokerage business from his employer to Classic. According to the order, Tippett also participated in a scheme to misappropriate confidential block trade order information from the same Classic customer, facilitated fictitious trades, and made false statements to ICE Futures US.\u00a0<\/p>\n\n\n\n

The order requires Tippett to disgorge $695,000<\/strong> in ill-gotten gains, imposes a $500,000<\/strong> civil monetary penalty, permanently bans Tippett from trading commodity interests, and requires him to comply with undertakings never to apply for registration or engage in any activity requiring registration with the CFTC. <\/p>\n\n\n\n

\u201cThe CFTC will vigorously pursue and take action to stop corruption among brokers and other intermediaries that facilitate trading in the derivatives markets, whether they are making illegal kickback payments or misappropriating nonpublic information,\u201d said Acting Director of Enforcement Gretchen Lowe. \u201cToday\u2019s action demonstrates that the CFTC is committed to taking action against all individuals who engage in such conduct.\u201d<\/p>\n\n\n\n

Case Background<\/strong><\/p>\n\n\n\n

According to the order, at Clark\u2019s request, Classic hired Tippett as a broker in November 2015 for the purpose of facilitating kickback payments to Clark. Tippett was a longtime associate of Clark and had no experience as a broker prior to being hired by Classic. As part of this kickback scheme, Tippett would broker natural gas futures block trades for Clark\u2019s employer, but would pay most of the commission income he earned on these trades back to Clark in exchange for Clark sending more brokerage business to Classic. Beginning on or around November 23, 2015, and continuing through August 2019, Tippett paid Clark approximately $3,185,775, and kept $695,000 of this commission income for himself. According to order, Tippett concealed these payments to Clark in a variety of ways, including by sending cash directly to Clark\u2019s family members or by transferring money to shell companies set up by Clark. Tippett admits the facts of this misconduct and acknowledges this conduct violated the Commodity Exchange Act (CEA).<\/p>\n\n\n\n

In addition, the order finds Tippett engaged in a scheme to misappropriate confidential block trade order information from Classic\u2019s brokerage customers. Tippett did so by disclosing certain block trade order information provided to him by a trader acting at Clark\u2019s direction. The information was disclosed to Peter Miller, an individual proprietary trader. Miller in turn traded on the basis of this information and shared his trading profits with other scheme participants, but not Tippett. The CFTC previously filed complaints against Clark and Miller for their roles in this scheme. [See CFTC Press Release No. 8490-22<\/a>] [See CFTC Press Release No. 8468-21<\/a>]    <\/p>\n\n\n\n

In addition, the order finds Tippett made false statements to ICE on September 15, 2016, in connection with ICE\u2019s investigation of certain block trades brokered by Classic. According to the order, Tippett made these false statements to conceal certain misconduct by Mathew Webb, Classic\u2019s owner and president, for which the CFTC previously charged Webb. [See CFTC Press Release No. 8030-19<\/a>]<\/p>\n\n\n\n

On August 17, 2021, Tippett entered a guilty plea in a separate, parallel criminal action against Tippett in the U.S. District Court for the Southern District of Texas (U.S. v. Tippett, 4:21-cr-364). <\/p>\n","protected":false},"excerpt":{"rendered":"

(HedgeCo.Net) The Commodity Futures Trading Commission has issued an order simultaneously filing and settling charges against Lee Tippett, a former broker with Classic Energy, LLC, for participating in a scheme to pay kickbacks to Matthew Clark, a trader employed by […]<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16,3,16048,16047],"tags":[],"class_list":["post-83253","post","type-post","status-publish","format-standard","hentry","category-hedgeco-networks-press-releases","category-hedgeco-news","category-hedgecovest-news","category-insider-trading-2"],"_links":{"self":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/83253","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/comments?post=83253"}],"version-history":[{"count":2,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/83253\/revisions"}],"predecessor-version":[{"id":83255,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/83253\/revisions\/83255"}],"wp:attachment":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/media?parent=83253"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/categories?post=83253"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/tags?post=83253"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}