October 24, 2014

Federal Court Orders California Resident Ryan A. Nassbridges and his California Companies to Pay over $18 Million in Civil Monetary Penalties in a Commodity Pool Precious Metals Scheme

Three Relief Defendants, including Bita Nassbridges, Ordered to Disgorge Ill-Gotten Gains Totaling More than $2.1 Million

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced that the U.S. District Court for the Central District of California entered a final judgment and permanent injunction Order against Defendants Ryan A. Nassbridges (a.k.a., Ryan Bridges and Ryan Nasserabadi) of Laguna Niguel, California, and American Bullion Exchange ABEX Corp. (ABEX Corp.), and American Bullion Exchange, LLC (ABEX LLC), both California companies owned and controlled by R. Nassbridges, in connection with a commodity pool precious metals scheme. 

The court’s final judgment Order, entered on October 8, 2014, by Judge David O. Carter, imposes permanent trading and registration bans against the Defendants and requires R. Nassbridges to pay a civil monetary penalty of $3,430,000 and ABEX Corp. and ABEX LLC, jointly and severally, to pay a civil monetary penalty of $14,790,000.   The order also permanently prohibits the Defendants from further violations of the Commodity Exchange Act and CFTC regulations, as charged. 

The Order also requires Relief Defendants Bita Nassbridges (Mrs. Nassbridges) of Laguna Niguel, California, and American Preferred Commodities APC Corp. (APC) and R.E. Lloyd Commodities Group Holding LLC (R.E. Lloyd), both California companies owned and controlled by R. Nassbridges, to disgorge $821,893, $110,600 and $1,250,000, respectively, of ill-gotten gains that they received from the Defendants’ fraud.

The Order stems from a CFTC Complaint filed on December 8, 2010, charging the Defendants with fraud, misappropriation, and registration violations in operating a precious metal scam while acting as a Commodity Pool Operator (CPO) or an Associated Person (AP) thereof (see CFTC Press Release 5955-10).  

The October 8 Order is based on the court’s August 7, 2014, summary judgment Order against R. and Mrs. Nassbridges, and its September 16, 2014, default judgment Order against ABEX Corp., ABEX LLC, APC, and R.E. Lloyd, which find that the Defendants fraudulently solicited approximately $5.5 million from approximately 80 participants by misrepresenting, among other things, that their funds would only be traded in bullion and coins and their investments would be insured against loss.  The Orders find that the Defendants misappropriated participants’ funds for the undisclosed trading of commodity futures and options, to pay personal expenses, and to funnel to third parties under R. Nassbridges’ control. 

The Orders also find that the Defendants did not maintain an insurance policy against investment loss and that the Defendants failed to inform participants that they used participant funds to trade commodity futures and options and that the Defendants’ trading of those funds resulted in significant losses. 

Additionally, the Orders find that ABEX Corp. and ABEX LLC failed to register with the CFTC as CPOs, operate their commodity pool as an entity separate from themselves, accept funds from participants only in the name of the pool, provide pool participants with disclosure documents, and provide participants with account statements.  The Orders further find that R. Nassbridges failed to register as an AP of a CPO.

CFTC Division of Enforcement staff members responsible for this case are Kevin S. Webb, Michelle S. Bougas, James H. Holl, III, Luke B. Marsh, Paul G. Hayeck, and Gretchen L. Lowe.

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CFTC’s Precious Metals Customer Fraud Advisory

The CFTC has issued several customer protection Fraud Advisories that provide the warning signs of fraud, including the Precious Metals Fraud Advisory, which alerts customers to precious metals fraud and lists simple ways to spot precious metals scams.

Customers can report suspicious activities or information, such as possible violations of commodity trading laws, to the CFTC Division of Enforcement via a Toll-Free Hotline 866-FON-CFTC (866-366-2382) or file a tip or complaint online. 

Media Contact
Dennis Holden
202-418-5088
 

Last Updated: October 24, 2014