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December 20, 2013
NFA takes emergency enforcement action against commodity pool operator R2 Capital Group LLC and its principal, Randell A. Vest
December 20, Chicago - National Futures Association (NFA) announced today that it has taken an emergency enforcement action against R2 Capital Group LLC (R2 Capital), an NFA Member commodity pool operator, which lists its address as New York City, and Randell A. Vest (Vest), a principal and the sole associated person (AP) of R2 Capital.
NFA has taken the Member Responsibility Action (MRA) and Associate Responsibility Action (ARA) to protect investors in commodity pools and other investment vehicles controlled by R2 Capital and Vest – and/or by Ryan Tomazin (Tomazin) and Ryan Madigan (Madigan), both of whom are unlisted principals of R2 Capital – because of their failure to cooperate with NFA in its examination and investigation of R2 Capital by failing to produce books, records and other information that NFA has requested from them. Additionally, R2 Capital, Vest and Tomazin have provided NFA with misleading, incomplete and conflicting information regarding the firm's operations, specifically in connection with the R2 Commercial Capital Partners I LP pool (Commercial Pool), and cannot account for a significant portion of the pool's assets, which appear to have been disbursed through so-called loans and other payouts to the owners of the firm. Consequently, NFA has been unable to determine whether R2 Capital, Vest, Tomazin and Madigan have misappropriated investors' funds and misled investors concerning their investments.
R2 Capital, Vest and any person acting on R2's behalf are prohibited from soliciting or accepting any funds from customers or investors, soliciting investments for any managed accounts, commodity pools or other investment vehicles, including the Commercial Pool or R2 Global Fund I LP (Global Pool), or placing any trades on behalf of customers, commodity pools or investors except liquidation or risk reducing trades. Additionally, they are prohibited from disbursing or transferring any funds over which they exercise control without prior approval from NFA.
R2 Capital and Vest also are required to immediately repay in full all existing direct and indirect loans or advances of pool assets to the Commercial Pool. Also, R2 Capital, Vest and any person acting on R2 Capital's behalf are prohibited from permitting any commodity pool they operate or control, including but not limited to the Commercial Pool and the Global Pool, to use any means to make any direct or indirect loans or advances of pool assets to R2 Capital, Vest or any other person or entity affiliated with R2 Capital and Vest.
The MRA/ARA will remain in effect until such time as R2 Capital and Vest have demonstrated to the satisfaction of NFA that they are in complete compliance with all NFA Requirements.
R2 Capital and Vest may request a hearing before NFA's Hearing Committee.