Thomas Gilmartin, the Man Financial broker named in the ongoing fraud case involving the firm and Philadelphia Alternative Asset Management (PAAM) (see FO Week Vol 10 No 39), has been suspended. It has also emerged that Paul Eustace, the PAAM official involved in the alleged fraud, has been under investigation by various regulatory bodies since as early as 2001.
National Futures Association and Commodity Futures Trading Commission (CFTC), which filed the original complaint against PAAM, have both held previous investigations into Eustace's activities.
CFTC has alleged the fraud dated back to 2001, when Eustace first raised millions of dollars from clients for a fund called Option Capital Fund. According to CFTC allegations, Eustace issued false account statements that showed Option Capital had been increasing in value from 2001 to May 2005. In fact, CFTC alleged, the only known commodity accounts in the name of Option Capital were closed in 2003...