Confessing to a fraud scheme valued at $3.5 million, hedge fund manager James Brandolino turned himself in to the FBI, according to media reports.
"Brandolino, 42, of Joliet and formerly of Chicago, obtained about $4.7 million from 48 high net worth investors since 2003 for purported managed futures trading accounts and a commodity pool investment," according to an FBI statement.
It continues: "He provided about $1.1 million in investor redemptions and allegedly lost roughly half of the total invested funds through trading and misused most of the remaining funds for his own benefit. Most of the misappropriated funds were spent, with his only remaining assets consisting of a luxury automobile, a watch and an interest in an unbuilt condominium in Greece on which he put down 80,000 Euros, or more than $107,000."
According to the FBI affidavit, "Brandolino has held NFA [National Futures Association] registrations in various capacities in the commodities brokerage business, including as an 'Associated Person,' a 'Floor Broker' and a 'Principal,' from May 1997 until January 2011, with exchange floor trading privileges at the Chicago Board of Trade, which is now part of the CME Group."
Brandolino served at a number of commodities trading firms including Brandolino Investment Group ('BIG'), Lloyd Lewis Capital, Falcon Trading Group and Falcon Capital Partners.
The alleged fraudster also admitted to falsifying financial statements. Brandolino appeared before U.S. Magistrate Judge Michael Mason and asked to remain in federal custody. If convicted, the hedge fund manager faces a maximum penalty of 20 years in prison, a $250,000 fine, and restitution is mandatory, according to media reports.
Phil Albinus is the former editor-in-chief of Advanced Trading. He has nearly two decades of journalism experience and has been covering financial technology and regulation for nine years. Before joining Advanced Trading, he served as editor of Waters, a monthly trade journal ... View Full Bio