Case: 1:14-cv-00738-MRB Doc #: 84 Filed: 08/12/21 Page: 1 of 15 PAGEID #: 990

UNITED STATES DISTRICT COURT 

SOUTHERN DISTRICT OF OHIO 

WESTERN DIVISION 

COMMODITY FUTURES TRADING 

COMMISSION, 

Plaintiff, 

v. 

GLEN GALEMMO, 

Defendant. 

) 

) 

) Civil Action No. l:14-cv-00738 

) 

) 

) Judge Michael R. Barrett 

) 

) 

) 

) 

) 

) 

) _______________ ) 

CONSENT ORDER FOR PERMANENT INJUNCTION AND OTHER EQUITABLE 

RELIEF AGAINST DEFENDANT GLEN GALEMMO 

I. INTRODUCTION 

On September 15, 2014, Plaintiff Commodity Futures Trading Commission 

("Commission" or "CFfC") filed a Complaint against Defendant Glen Galemmo ("Galemmo" or 

"Defendant"), for violations of Sections 4b( a)(l) (A)-(C), 4m(l) and 4o(l )(A), (B) of the 

Commodity Exchange Act ("Act") 1 7 U.S.C. §§ 6b(a){l) (A)-(C), 6m{l) and 60(1) (A), (B) 

(2018). By stipulation of the parties, the third Count of the Complaint, alleging that Galemmo 

had violated Section 4m{l) of the Act by acting as a commodity pool operator ("CPO") without 

being registered as one, was dismissed with prejudice on February 8, 2019 (D.E. 61). 

1 Iri 20 l 0 the Act was amended by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 20 l 0 (''DoddFrank Act"), Pub. L. No. 111-203, Title VII (The Wall Street Transparency and Accountability Act of2010), §§ 701-

774, 124 Stat. 1376, 1641 et seq. (effective July 16, 2011). 

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II. CONSENTS AND AGREEMENTS 

To effect settlement of all charges alleged in the Complaint against Galemmo without a 

trial on the merits or any further judicial proceedings, Defendant: 

1. Consents to the entry of this Consent Order for Permanent Injunction and Other 

Equitable Relief Against Defen<;iant Glen Galemmo ("Consent Order"); 

2. Affirms that he has read and agrees to this Consent Order voluntarily, and that no 

promise, other than as specifically c~mtained herein, or threat, has been made by the Commission 

or any member, officer, agent or representative thereof, or by any other person, to induce consent 

to this Consent Order; 

3. Acknowledges service of the summons and Complaint; 

4. Admits the jurisdiction of this Court over him and the subject matter of this action 

pursuant to Section 6c of the Act, 7 U.S.C. § 13a-l (2018); 

5. Admits the jurisdiction of the Commission over the conduct and transactions at 

issue in this action pursuant to the Act, 7 U.S.C. §§ 1, et seq. (2018); 

6. Admits that venue properly lies with this Court pursuant to Section 6c( e) of the 

Act, 7 U.S.C. § 13a-l(e) (2018); 

7. Waives: 

(a) any and all claims that he may possess under the Equal Access to Justice 

Act, 5 U.S.C. § 504 (2006) and 28 U.S.C. § 2412 (2006), and/or the rules promulgated by the 

Commission in conformity therewith, Part 148 of the Regulations, 17 C.F.R. §§ 148.1 et seq. 

(2019), relating to, or arising from, this action; 

(b) any and all claims that he may possess under the Small Business 

Regulatory Enforcement Fairness Act of 1996, Pub. L. No. 104-121, §§ 201-253, 110 Stat. 847, 

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857-868 (1996), as amended by Pub. L. No. 110-28, § 8302, 121 Stat. 112, 204-205 (2007), 

relating to, or arising from, this action; 

(c) any claim of Double Jeopardy based upon the institution of this action or 

any other relief, including this Consent Order; and 

( d) any and all rights of appeal from this action; 

8. Consents to the continued jurisdiction of this Court over him for the purpose of 

implementing and enforcing the terms and conditions of this Consent Order and for any other 

purpose relevant to this action, even if Defendant now or in the future reside outside the 

jurisdiction of this Court; 

9. Agrees that he will not oppose enforcement of this Consent Order by alleging that 

it fails to comply with Rule 65(d) of the Federal Rules of Civil Procedure and waives any 

objection based thereon; 

10. Consents to the entry of this Consent Order without admitting or denying the 

allegations of the Complaint or any findings or conclusions expressly set forth in this Consent 

Order, except as to jurisdiction and venue, and paragraph 20, which he admits; 

11. · Agrees that neither he nor any of his agents or employees under his authority or 

control shall take any action or make any public statement denying, directly or indirectly, any 

allegation in the Complaint, or the Findings of Fact or Conclusions of Law in this Consent Order, 

or creating or tending to create the impression that the Complaint and/or this Consent Order is 

without factual basis; provided, however, that nothing in this provision shall affect his: 

(a) testimonial obligations, or (b) right to take legal positions in other proceedings to which the 

Commission is not a party. Defendant shall undertake all steps necessary to ensure that all of his 

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agents and/or employees under his authority or control understand and comply with this 

agreement; 

12. Agrees to provide immediate notice to this Court and the Commission by certified 

mail, in the manner required by paragraph 39 of Section VI of this Consent Order, of any 

bankruptcy proceeding filed by, on behalf of, or against him, whether inside or outside the 

United States; and 

13. Agrees that no provision of this Consent Order shall in any way limit or impair 

the ability of any other person or entity to seek any legal or equitable remedy against the 

Defendant in any other proceeding. 

III.FINDINGS AND CONCLUSIONS 

The Court, being fully advised in the premises, finds that there is good cause for the entry 

of this Consent Order and that there is no just reason for delay. The Court therefore directs the 

entry of the following Findings of Fact, Conclusions of Law, Permanent Injunction and 

Equitable Relief pursuant to Section 6c of the Act, 7 U.S.C. § Ba-1(2018), as set forth herein. 

THE PARTIES AGREE AND THE COURT HEREBY FINDS: 

A. FINDINGS OF FACT 

1. The Parties to This Consent Order 

14. Plaintiff Commodity Futures Trading Commission is an independent federal 

regulatory agency that is charged by Congress with administering and enforcing the Act, 

7 U .S.C. §§ 1 et seq. (2018), and the Commission Regulations promulgated thereunder, 17 

C.F.R. §§ 1.1 et seq. (2020). 

15. Defendant Glen Galemmo is a federal inmate in Salters, South Carolina. 

Galemmo was.the sole owner ofQFC, LLC. During the period February 18, 2010 through at 

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least July 17, 2013 (the "relevant period"), Galemmo controlled QFC, LLC's commodity interest 

accounts. Galernmo was listed as a principal of QFC. On January 15, 2014, Galernmo pleaded 

guilty in a QFC related criminal case. See United States v. Glen Galemmo, Case No. 1: 13-cr00141-HJW. 

2. Other Relevant Entities 

16. QFC, LLC also known as ("a/k/a") Queen City Investments a/k/a Queen City 

Investment Fund II, LLC a/k/a Queen City Holdings, LLC a/k/a Queen City Hedge Fund, LLC 

(hereinafter "QFC"), was a limited liability company which had its principal place of business 

located in Cincinnati, Ohio. QFC was registered as a Commodity Pool Operator ("CPO") with 

the National Futures Association (''NF A") from April 1, 2011 through December 16, 2013, with 

Galemmo listed as QFC's principal during this same period. On December 16, 2013, the NFA 

permanently barred QFC from NF A membership and from acting as a principal of an NF A 

membership based upon findings that QFC violated NF A rules by failing to uphold high 

standards of commercial honor and just and equitable principles of trade. QFC's NFA 

membership ban became effective on December 31, 2013. 

3. Statutory and Regulatory Background 

17. Prior to July 16, 2011, Section la{5) of the Act, 7 -U.S.C. § la(5) (2006), defined a 

CPO or "commodity pool operator'' as any firm or individual engaged in a business which is of 

the nature of an investment trust, syndicate, or similar form of enterprise, and that, in connection 

therewith, solicits, accepts, or receives from others funds, securities, or property, either directly 

through capital contributions, the sale of stock or other forms of securities, or otherwise, for the 

purpose of trading in any commodity for future delivery on or subject to the rules of any contract 

market. Upon the effective date of.Title VII of the Dodd-Frank Act on July 16, 2011, the 

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definition of a CPO was clarified, expanded, and re-designated in Section 1 a( 11) of the Act, 

7 U.S.C. § la(l l) (2018). 

18. Sections 4b{a)(l)(A)-(C) of the Act, 7 U.S.C. § 6b(a)(l)(A)-(C) (2018) make it 

unlawful: 

for any person, in or in connection with any order to make, or the making of: any contract 

of sale of any commodity in interstate commerce or for future delivery that is made, or to 

be made, on or subject to the rules of a designated contract market, for or on behalf of 

any other person- (A) to cheat or defraud or attempt to cheat or defraud the other person; 

(B) willfully to make or cause to be made to the other person any false report or 

statement or willfully to enter or cause to be entered for the other person any false record; 

[ or] (C) willfully to deceive or attempt to deceive the other person by any means 

whatsoever in regard to any order or contract or the disposition or execution of any order 

or contract, or in regard to any act of agency performed, with respect to any order or 

contract for or, in the case of paragraph (2), with the other person. 

19. Sections 4o(l)(A), (B) of the Act, 7 U.S.C. § 6o(l)(A), (B) (2018) make it 

unlawful for any ... commodity pool operator, or associated person of a commodity pool 

operator by use of the mails or any means or instrumentality of interstate commerce, directly or 

indirectly -

(A) to employ any device, scheme, or artifice to defraud any client or participant; or 

(B) to engage in any transaction, practice, or course of business which operates as a fraud 

or deceit on any client or participant or prospective client or participant. 

4. Galemmo's Fraudulent Operation 

20. On December 15, 2013, Galemmo signed a Plea Agreement and a Statement of 

Facts in United States v. Glen Galemmo, Case No. l:13-cr-00141-HJW. The Statement of Facts 

attached to the Plea Agreement, ECF 2, is ip.corporated herein by reference. 

21. During the relevant period, Galemmo controlled the operations of QFC. 

Galemmo and was the sole owner and principal of QFC. Galemmo exercised control over 

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various bank accounts held at US Bank and KeyBank (collectively, "QFC bank accounts") into 

which pool participants' funds were deposited. 

22. During the relevant period, Galemmo, through QFC, solicited actual and 

prospective pool participants by offering them various investment opportunities including 

commodity futures, commodities, stocks, and bonds. 

5. Galemmo's Misappropriation 

23. From at least February 2010 to July 2013, Galemmo received funds from 

individual pool participants, including, individuals, trusts, charitable organizations, and 

retirement accounts. During this period, Galemmo also received funds from some pool 

participants in the form of short term loans. Galemmo received these funds through interstate 

wire transfers and other instrumentalities of interstate commerce, including but not limited to 

mailings delivered by the United States Postal Service. 

24. In April 2011, September 2011, and April 2013, Galemmo opened or caused to be 

opened four futures trading accounts at Interactive Brokers, LLC ("IBL") in the name of QFC 

but only funded three of the accounts. During the life of these accounts, QFC traded various 

energy, grain, metals, and financial futures contracts. 

25. In September 2012, Galemmo opened or caused to be opened three additional 

accounts in the name of QFC at Dorman Trading, LLC ("DTL"). During.the life of these 

accounts, QFC traded various energy, grain, metals, and financial futures contracts. 

26. Galemmo deposited approximately $4.7 million into the futures accounts that he 

controlled at IBL and DTL. Galemmo also withdrew or caused to be withdrawn $2. 7 million in 

pool participants' funds from these futures accounts. 

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27. The futures accounts at !BL and DTL that Galemmo controlled sustained total 

trading losses of approximately $1.2 million. 

28. During the relevant period, Galemmo, through QFC, acted as a CPO by soliciting 

and accepting funds from individuals and pooling those funds for the purpose of trading, among 

other things, futures contracts. 

B. CONCLUSIONS OF LAW 

1. Jurisdiction and Venue 

29. This Court has jurisdiction over this action pursuant to Section 6c of the Act, as 

amended, 7 U.S.C. § 13a-1 (2018), which provides that whenever it shall appear to the 

Commission that any person has engaged, is engaging, or is about to engage in any act or 

practice constituting a violation of any provision of the Act or any rule, regulation, or order 

promulgated thereunder, the Commission may bring an action in the proper district court of the 

United States against such person to enjoin such act or practice, or to enforce compliance with 

the Act, or any rule, regulation or order thereunder. 

30. Venue properly lies with this Court pursuant to Section 6c(e) of the Act, as 

amended, 7 U.S.C § 13a-l(e) (2018), because the Defendants reside in this jurisdiction and the 

acts and practices in violation of the Act occurred within this District. 

2. Violation of Sections 4b(a)(l)(A)-(q of the Act, 7 U.S.C. § 6b(a)(l)(A)-(C) (2018): 

Fraud in Connection with Commodity Futures Contracts 

31. Section 4b(a)(l)(A)-(C) of the Act, 7 U.S.C. §§ 6b(a)(l)(A)-(C) (2018), provides, 

in relevant p~ that it is unlawful for any person, in or in connection with any order to make, or 

the making of, any contract of sale of any commodity in interstate commerce or for future 

delivery that is made, or to be made, on or subject to the rules of a designated contract market, 

for or on behalf of any other person ... (A) to cheat or defraud or attempt to cheat or defraud the 

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other person; (B) willfully to make or cause to be made to the other person any false report or 

statement or willfully to enter or cause to be entered for the other person any false record; 

(C) willfully to deceive or attempt to deceive the other person by any means whatsoever in 

regard to any order or contract or the disposition or execution of any order or contract, or in 

regard to any act of agency performed, with respect to any order or contract for the other person. 

32. By the conduct described in paragraphs 1 through 28 above, Galemmo, violated 

Section 4b(a)(l)(A)-(C) of the Act, by, among other things: (1) making misrepresentations 

concerning the Pool's performance record; (2) failing to disclose material information; including, 

that he was not properly registered as a CPO, that he only invested a small portion of pool 

participants' funds, and that the Pool sustained consistent net losses; (3) issuing or causing to be 

issued false account statements to pool participants reflecting positive returns for the Pool and 

increases in the value of individual pool participants' interest; (4) misappropriating pool 

participant funds by using such funds to pay principal and purported returns to other pool 

participants; and (5) misappropriating pool participant funds to pay other business and personal 

expenses. 

3. Violation of Section 4o(l) of the Ac~ 7 U.S.C. § 60(1) (2018): Fraud by a 

Commodity Pool Operator 

33. Section 4o(l) of the Act, 7 U.S.C. § 60(1) (2018), prohibits CPOs from using the 

mails or any other means or instrumentality of interstate commerce to (A) employ any device, 

scheme or artifice to defraud any client or participant or prospective client or participant; or 

(B) engage in any transaction, practice or course of business which operates as a fraud or deceit 

upon any client or participant or prospective participant. 

34. By the conduct described in paragraphs 1 through 28 above, Galemmo acted as a 

CPO by soliciting, accepting, or receiving funds from others while engaged in a business that is 

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of the nature of a commodity pool, investment trust, syndicate, or similar form of enterprise, for 

the purpose of, among other things, trading in futures. 

35. Galemmo violated Section 4o(l)(A) and (B) of the Act, in that he employed or is 

employing a device, scheme or artifice to defraud actual and prospective pool participants or 

engaged or is engaging in transactions; practices, or a course of business which operated or 

operates as a fraud or deceit upon the pool participants or prospective pool participants. The 

fraudulent acts include distributing false account statements to pool participants. 

36. Unless restrained and enjoined by this Court, there is a reasonabie likelihood that 

the Defendant will continue to engage in the acts and practices alleged in the Complaint and in 

similar acts and practices in violation of the Act and Commission Regulations. 

IV. PERMANENT INJUNCTION 

IT IS HEREBY ORDERED THAT: 

37. Based upon and in connection with the foregoing conduct, pursuant to Section 6c 

of the Act, 7 U.S.C. § 13a-1 (2018), Galemmo and any of his agents, servants, employees, 

assigns, attorneys, and persons in active concert or participation with him, including·successors 

thereof are permanently restrained, enjoined and prohibited from directly or indirectly: 

(a) in or in connection with any order to make, or the making of, any contract of sale 

of any commodity in interstate commerce or for future delivery that is made, or to 

be made, on or subject to the rules of a designated contract market, for or on 

behalf of any other person - (1) cheating or defrauding or attempting to cheat or 

defraud any person; (2) willfully making or causing to be made to any person any 

false report or statement or causing to be entered for any person any false record; 

or (3) willfully deceiving or attempting to deceive any person by any means 

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whatsoever in violation of Section 4b(a)(l)(A)-(C) of the Act, 7 U.S.C. 

§ 6b(a)(l)(A)-(C) (2018); and 

(b) by use of the mails or any means or instrumentality of interstate commerce and 

while acting as a CPO as that term is defined by Section la(l 1) of the Act, 

7 U.S.C. § la(l 1) (2018): (1) employing any device, scheme or artifice to defraud 

any client or participant or prospective client or participant; or (2) engaging in any 

transaction, practice or course of business which operates as a fraud or deceit 

upon any client or participant in violation of Section 40(1) of the Act, 7 U.S.C. 

§ 60(1) (2018). 

38. Defendant is also permanently restrained, enjoined and prohibited from directly or 

indirectly: 

(a) Trading on or subject to the rules of any registered entity (as that term is defined 

in Section la(40) of the Act, 7 U.S.C. § la(40) (2018)); 

(b) Entering into any transactions involving "commodity interests" (as that term is 

defined in Regulation l.3(yy), 17 C.F.R. § l.3(yy) (2020) for their own personal 

account or for any account in which they have a direct or indirect interest; 

( c) Having any commodity interests traded on his behalf; 

( d) Controlling or directing the trading for or on behalf of any other person or entity, 

whether by power of attorney or otherwise, in any account involving commodity 

interests; 

( e) Soliciting, receiving or accepting any funds from any person for the purpose of 

purchasing or selling any commodity interests; 

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(f) Applying for registration or claiming exemption from registration with the 

Commission in any capacity, and engaging in any activity requiring such 

registration or exemption from registration with the Commission, except as 

provided for in Regulation 4.14(a)(9), 17 C.F.R. § 4.14(a)(9) (2020); and/or 

(g) Acting as a principal ( as that term is defined in Regulation 3 .1 (a), 17 C.F .R. 

§ 3.l(a) (2020), an agent or any other officer or employee of any person (as that 

term is defined in Section la(38) of the Act, 7 U.S.C. § la(38) (2018)) registered, 

exempted from registration or required to be registered with the Commission 

except as provided for in Regulation 4.14(a)(9), 17 C.F.R. § 4.14(a)(9) (2020). 

V. MISCELLANEOUS PROVISIONS 

39. . Notice: All notices required to be given by any provision in this Consent Order 

shall be sent certified mail, return receipt requested, as follows: 

Notice to Commission: 

Paul G. Hayeck, Esq. 

Deputy Director 

Commodity Futures Trading Commission 

Three Lafayette Centre 

1155 21st Street, N.W., Seventh Floor 

Washington, D.C. 20581 · 

All such notices to the Commission shall reference the name and docket number of this action. 

40. Entire Agreement and Amendments: This Consent Order incorporates all of the 

terms and conditions of the settlement among the parties hereto to date. Nothing shall serve to 

amend or modify this Consent Order in any respect whatsoever, unless: (a) reduced to writing; 

(b) signed by all parties hereto; and ( c) approved by order of this Court. 

41. Invalidation: If any provision of this Consent Order or if the application of any 

provision or circumstance is held invalid, then the remainder of this Consent Order and the 

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application of the provision to any other person or circumstance shall not be affected by the 

holding. 

42. Waiver: The failure of any party to this Consent Order at any time to require 

performance of any provision of this Consent Order shall in no manner affect the right of the 

party at a later time to enforce the same or any other provision of this Consent Order. No waiver 

in one or more instances of the breach of any provision contained in this Consent Order shall be 

deemed to be or construed as a further or continuing waiver of such breach or waiver of the 

breach of any other provision of this Consent Order. 

43. Acknowledgements: Upon being served with copies of this Consent Order after 

entry by the Court, the Defendant shall sign acknowledgements of such service and serve such 

acknowledgements on the Court and the Commission within ten (10) calendar days. 

44. Continuing Jurisdiction of this Court: This Court shall retain jurisdiction of this 

action to ensure compliance with this Consent Order and for all other purposes related to this 

action," including any motion by the Defendant to modify or for relief from the terms of this 

Consent Order. 

45. Injunctive and Equitable Relief Provisions: The injunctive and equitable relief 

provisions of this Consent Order shall be binding upon the Defendant, upon any person under his 

authority or control, and upon any person who receives actual notice of this Consent Order, by 

personal service, e-mail, facsimile or otherwise insofar as he or she is acting in active concert or 

participation with the Defendant. 

46. Counterparts and Facsimile Execution: This Consent Order may be executed in 

two or more counterparts, all of which shall be considered one and the same agreement and shall 

become effective when one or more counterparts have been signed by each of the parties hereto 

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12th August

/s/ Michael R. Barrett

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and delivered (by facsimile, e-mail, or otherwise) to the other party, it bemg understood that all 

parties need not sign the same counterpart. Any counterpart or other signature to this Consent 

Order that is delivered by any means shall be deemed for all purposes as constituting good and 

valid execution and delivery by such party of this Consent Order. 

47. Defendant understands that the terms of the Consent Order are enforceable 

through contempt proceedings, and that, in any such proceedings they may not challenge the 

validity of this Consent Order. 

There being no just reason for delay, the Clerk of the Court is hereby directed to enter 

this Consent Order for Permanent Injunction and Other Equitable Relief Against Defendant 

Glen Ga/emmo. 

IT IS SO ORDERED on this __ day of ___ ______ , 2021. 

CONSENTED TO AND APPROVED BY: 

JJliL......---

Defen~t <3:len Gal~mmo 

Date: .J u 111 I 1 .;2 c:, 2 / 

HONORABLE Michael R. Barrett 

UNITED STATES DISTRICT JUDGE 

arsh@cftc.gov) 

Division of Enforcement 

U.S. Commodity Futures Trading Commission 

Three Lafayette Centre 

1155 21st Street N.W. 

Washington, D.C. 20581 

Telephone: (202) 418-5000 

Facsimile: (202) 418-5937 

COMMODITY FUTURES TRADING 

COMMISSION 

Date: oB/42--/4o2-1 

7 

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~z 

Paul M$aufman 

Laufefan/Napolitano LLC 

4310 Hunt Road 

Cincinnati, Ohio 45242 

Telephone: (513) 561-4556 

Facsimile: (513) 561-5563 

plaufman@LF-lawfirm.com 

Attorney for Glen Galemmo 

Date: ~~/2; 

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