U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 25806 / August 8, 2023
Securities and Exchange Commission v. Chad Stickforth, No. 1:23-cv-02000 (D. Colo. filed Aug. 8, 2023)
SEC Charges Former Hedge Fund Managing Director with Fraud
The Securities and Exchange Commission today announced settled fraud charges against Chad Stickforth, the former managing director of RSF Capital, LP, related to the misuse and misappropriation of millions of dollars raised from investors.
The SEC’s complaint, filed in federal district court in Colorado, alleges that between December 2016 and September 2021, Stickforth, through RSF, raised approximately $5.4 million from twenty investors after telling investors that RSF would use their money to trade futures contracts, commodity interests, and options on their behalf. In fact, the complaint alleges, Stickforth only used a small portion of the investors’ money to trade, and he misappropriated or otherwise misused most of the investors’ funds by using them for personal expenses, payments to his business partner, and Ponzi-like payments to investors to keep up the appearance of profitable trading.
Without admitting or denying the SEC’s allegations, Stickforth has consented to the entry of a final judgment that would permanently enjoin him from violating the anti-fraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940; impose a permanent officer-and-director bar; and order him to pay $1,546,197 in disgorgement, prejudgment interest, and a civil penalty of $223,229. The settlement is subject to court approval.
The SEC’s investigation was conducted by John Dwyer, Yamini Piplani Grema, and Daniel Konosky, with the assistance of Terry Miller and Gregory Kasper, and was supervised by Danielle R. Voorhees, Nicholas P. Heinke, and Jason J. Burt, all of the SEC’s Denver Regional Office.