Former Delta Air Lines fuel trader Jon Ruggles has been ordered by the U.S. Commodity Futures Trading Commission to give up $3.5 million of “ill-gotten gains” and pay a penalty of $1.75 million.
Ruggles was hired by Delta to help overhaul its struggling fuel hedging operation and worked as its vice president of fuel management from 2011 to 2012. He also championed Delta’s unconventional purchase of an oil refinery. Delta fired him after it learned in late 2012 of the investigation by the CFTC.
The CFTC on Thursday announced it is settling charges against Ruggles for “fraudulent, fictitious, and noncompetitive trades” in oil and gasoline futures on the New York Mercantile Exchange (NYMEX). The $5.25 million to be paid by Ruggles will go to the U.S. Treasury.
In addition to the penalties, the CFTC also permanently banned Ruggles from trading.
The CFTC said Ruggles used Delta’s trading information to “trade for his own personal benefit in personal accounts he controlled,” including in personal accounts in his wife’s name that he controlled.
Earlier this year, NYMEX levied $3.1 million in penalties against Ruggles for the same actions and barred him for life.
Ruggles, who lived in Atlanta while working for Delta, now lives in Orlando.
Ruggles “owed a duty of trust and confidence to act in the employer’s best interest,” but breached those duties and “misappropriated the employer’s confidential, material, nonpublic trading information for his own personal benefit,” the CFTC said in a press release.
In a written statement, CFTC director of enforcement Aitan Goelman called that fraud, saying it “undermines the integrity of the derivatives markets. We will continue to be vigilant in clamping down on such abuses.”
MORE:
About the Author
