CFTC Announces $9.2 Million Penalty in Louisiana Forex Fraud Case

The Commodity Futures Trading Commission said Wednesday that a federal court in Louisiana has ordered Michael B. DePetrillo and two companies he controlled to pay a $9,211,492 civil monetary penalty in a civil case tied to a fraudulent retail forex scheme.

The order, entered by the U.S. District Court for the Eastern District of Louisiana, also permanently bars DePetrillo, Meteor LLC and NOLA FX Capital Management LLC from future violations of the Commodity Exchange Act and CFTC regulations. In addition, the court imposed permanent trading and registration bans, closing the regulator’s 2024 enforcement case against the defendants.

The new civil judgment does not replace the related criminal case. DePetrillo had already pleaded guilty in February 2025 to violating the Commodity Exchange Act in connection with the same underlying conduct, and he was later sentenced to nine years in prison and ordered to pay $6,748,412 in restitution. That means the latest ruling adds another layer of punishment, one aimed at the public-enforcement side of the case rather than victim compensation alone.

Court order adds a civil penalty to earlier criminal sanctions

In its announcement of the ruling, the CFTC said the court entered a default judgment against DePetrillo and the two companies for their participation in a fraudulent retail forex scheme. The agency said the court found that the defendants fraudulently solicited participants and misappropriated more than $3 million, while falsely telling clients that their money would be used to trade retail foreign exchange. The court also found that the defendants issued false account statements and made material misrepresentations and omissions about the profitability of the supposed trading program.

The CFTC said the court further found that participant money was diverted in several ways: to make payments to earlier participants in a manner the agency compared to a Ponzi scheme, to cover DePetrillo’s personal expenses, and to fund trading in DePetrillo’s own account. According to the regulator, the default judgment resolves all claims in the civil complaint it filed last year. The agency disclosed the court order in a press release on October 21.

The size of the civil monetary penalty matters because it shows the court accepted a substantial enforcement remedy even after the criminal case had already produced a prison term and restitution order. In CFTC actions, civil monetary penalties serve a deterrence function. They are separate from restitution, which is meant to compensate victims, and separate from injunctions and market bans, which are designed to prevent future violations. In this case, the court used all three tools: a penalty, a permanent injunction, and permanent trading and registration bans.

Because the order was entered as a default judgment, the regulator did not need a conventional merits trial to obtain final relief. What matters for readers is that the CFTC’s case has now ended with a court order imposing concrete sanctions, not merely unresolved allegations. The agency framed the result as the conclusion of its October 2024 enforcement action against DePetrillo, Meteor and NOLA FX Capital.

How the scheme was described by regulators and prosecutors

When the CFTC filed its civil complaint in October 2024, it alleged that the defendants had solicited and accepted at least $7.6 million from at least 40 individuals starting in or around July 2017. The complaint said investors were told that their money would be pooled in NOLA FX Fund LLC and used to trade foreign-currency pairs on a leveraged, margined or financed basis, a market segment often described as retail forex.

The complaint also alleged that, rather than trading as represented, the defendants misappropriated client money. According to the filing, the funds were used to make payments to existing participants, to pay personal expenses, and to support DePetrillo’s own trading. The complaint further alleged that false account statements were sent to participants to create the appearance of genuine forex activity and profitable returns, even though no such trading performance existed as represented.

Prosecutors later described a broader record in the related criminal case. In a July 2025 sentencing release, the U.S. Department of Justice said DePetrillo, acting through several companies including Meteor, NOLA FX Capital Management, ELC Enterprise Solutions and Argosapolis, took in approximately $9.2 million from about 55 victim investors over seven years. DOJ said he lured investors by claiming he was trading foreign currencies, gold futures options, stocks and cryptocurrency, but instead misappropriated client funds.

The Justice Department said those funds were used in part to pay about $3.7 million in purported returns to prior investors, about $575,000 on DePetrillo’s personal investments, about $425,000 on rent, about $200,000 on private air travel and about $300,000 on online gambling, among other personal expenses. Prosecutors also said he issued fictitious account statements in the names NOLA FX Fund and NOLA FX Capital to conceal the misuse of money. Those details appeared in the department’s sentencing announcement after the criminal case.

The difference between the figures cited across the civil and criminal materials is worth noting. The 2024 CFTC complaint described at least $7.6 million raised from at least 40 individuals. The later DOJ sentencing release described approximately $9.2 million from about 55 victim investors. That does not necessarily signal a contradiction. Civil complaints often reflect the evidence assembled at the time of filing, while later criminal records can capture a fuller accounting developed through plea proceedings and sentencing.

What the case means and what comes next

The headline number in this case is the $9.2 million civil monetary penalty, but the broader outcome is the combination of sanctions now attached to DePetrillo and his firms. On the criminal side, he has a nine-year prison sentence and a restitution obligation of $6.75 million. On the civil-enforcement side, he and the two companies face a multimillion-dollar penalty, a permanent injunction and lifetime-style market access restrictions through the trading and registration bans described by the CFTC.

For the CFTC, the case is also part of a broader message about retail forex and commodity-pool fraud. The regulator has repeatedly warned that schemes promising consistent or outsized returns in complex markets often rely on fabricated account statements, misuse of customer funds or both. This case fit that pattern closely, based on the allegations and findings summarized by the agency and the later criminal case.

The ruling also shows how parallel civil and criminal enforcement can work together. The CFTC brought the civil case seeking remedies such as penalties, restitution and trading bans. Federal prosecutors pursued the criminal case, which carries the possibility of imprisonment. The CFTC specifically thanked the U.S. Attorney’s Office for the Eastern District of Louisiana and the FBI’s New Orleans Division for their assistance, underscoring that the matter was handled across agencies rather than by a single regulator acting alone.

There may still be practical limits on how much money victims ultimately recover, because a court order and a collection outcome are not the same thing. But from an enforcement standpoint, the important next step has already occurred: the civil case is no longer pending. The default judgment entered by the Eastern District of Louisiana gives the CFTC a final court order, and the related criminal matter has already produced sentencing. Taken together, those outcomes leave little procedural ambiguity about the government’s position on the conduct alleged in the case.