Former CEO Pleads Guilty in Cherry-Picking Investment Scheme

Former CEO Pleads Guilty in Cherry-Picking Investment Scheme

Kambolin’s Background

eter Kambolin, a U.S.-Russian national residing in Sunny Isles Beach, Florida, was the owner and CEO of Systematic Alpha Management LLC (SAM), an investment firm that purported to offer algorithmic trading strategies related to futures contracts.

The Cherry-Picking Scheme

Between January 2019 and November 2021, Kambolin, also a commodity trading advisor and commodity pool operator at the time, engaged in a fraudulent cherry-picking scheme.

He manipulated the allocation of profits and losses from futures trades to favor his personal accounts over those of his clients.

Misrepresentation to Clients

Kambolin misrepresented the nature of SAM’s trading strategies to his clients, claiming a focus on cryptocurrency futures contracts and foreign exchange futures contracts.

In reality, nearly half of Kambolin’s trading activities in each pool involved equity index futures contracts.

International Deception

Kambolin’s actions defrauded investors in both the United States and abroad. His scheme deprived them of potential profits.

He further used the ill-gotten gains to cover personal expenses, including rent for a beachfront apartment, and transferred funds to foreign bank accounts controlled by a co-conspirator in Belarus and Dominica.

Justice Department’s Response

cting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division emphasized the breach of client trust for personal gain and the resulting impact on investor confidence in commodities markets.

Collaborative Investigation

The case is being investigated by the Federal Deposit Insurance Corporation Office of Inspector General (FDIC-OIG).

Assistant Inspector General for Investigations Shimon R. Richmond expressed commitment to working with law enforcement partners to protect investors and the banking system from such financial crimes.

Legal Consequences

Kambolin has pleaded guilty to conspiracy to commit commodities fraud. He faces a maximum prison sentence of five years, with the sentencing date yet to be determined.

The sentence will be determined by a federal district court judge, taking into account sentencing guidelines and statutory factors.

CFTC’s Previous Action

The Commodity Futures Trading Commission (CFTC) previously charged Kambolin and SAM through a complaint.

Prosecution Details Trial Attorney Matt Kahn from the Criminal Division’s Fraud Section is responsible for prosecuting the case.

TDPel Media

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