CHICAGO, April 16 (UPI) — A federal judge in Chicago sentenced rogue trader Evan Dooley to five years in prison for inflicting $141 million in trading losses on MF Global Inc.
U.S. District Judge Robert Dow Jr. also ordered Dooley, 45, of Mount Pleasant, Tenn., to repay the financial firm $141,024,294 for losses on trades he set up from his home computer that far exceeded his ability to cover if the bets lost money.
Prosecutors said Dooley was permitted to make trades from his home on his own account and for clients. He also gave MF Global fraudulent information about his finances in order to put the firm in a position to act as his financial guarantor, the Justice Department said.
On Feb. 26, 2008, Dooley initiated buy and sell orders for 31,964 wheat futures contracts on the Chicago Board of Trade — each contract representing 5,000 bushels of wheat — even though he started with a negative balance of $3,000 in his account.
Dooley was betting short, meaning he would have made money if the price of wheat had dropped. Instead, it rose. Within two days, he was in the hole for more than $141 million, prosecutors said.
The defendants “willful criminal conduct caused a staggering loss to MF Global. The public, and in this case the financial services industry, needs to know that the courts will deter and incapacitate individuals like [the] defendant,” prosecutors said in a sentencing memo.
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