Minnesota Man Arrested in Connection with Ponzi Scheme

The U.S. Department of Justice reports in its press release (quotation, not an independent finding): “WASHINGTON – A Minnesota man was arrested today on charges related to an alleged Ponzi scheme involving commodity pools, Acting Assistant Attorney General Rita M. Glavin for the Criminal Division and U.S. Attorney Frank J. Magill for the District of Minnesota announced. Charles "Chuck" E. Hays, of Rosemount, Minn., was charged in a criminal complaint filed in the District of Minnesota with one count of wire fraud and one count of mail fraud. According to the complaint, Hays allegedly induced investors to provide funds to Crossfire Trading, LLC (Crossfire), a company for which the listed operating address was the same as Hays’ residence. According to the complaint, Hays allegedly told investors their money had been invested in a "pooled" commodities trading account, using misrepresentations such as false statements from a commodities brokerage firm, when in reality no such investments were ever made. The complaint alleges that Crossfire had no commodities trading account and the documents shown and sent to victim investors were fabrications. The complaint also alleges that Hays used the money wired to his bank accounts by investors for his personal expenses, including the purchase of an approximately $3 million yacht, as well as for payments to other investors. Hays is scheduled to appear today before a magistrate judge for the U.S. District Court for the District of Minnesota. Additionally, the government has seized the yacht Hays purchased with investor funds as well as bank accounts, which contain approximately $1 million in funds allegedly obtained through the fraudulent”