Full Report

Key Points

  • Ray Thomas Brown, Phoenix-based former financial advisor, convicted of commodity investment fraud.
  • Defrauded investors of over $1 million with false promises of high guaranteed returns.
  • Sentenced to 24 months in prison in 2014 for wire fraud and related crimes.
  • Faced civil penalties, including restitution, disgorgement, and fines totaling over $1.27 million.
  • Permanently barred from trading and participating in commodity-related activities.

Overview

Ray Thomas Brown operated as the owner and proprietor of Ray Brown & Associates in Phoenix, Arizona. He presented himself as an experienced commodities trader specializing in futures contracts, including crude oil, currencies, and indices. Through his unregistered firm, he solicited investments into pooled commodity programs and managed individual trading accounts, claiming expertise in technical and fundamental analysis to deliver exceptional profits.

Allegations and Concerns

Brown faced serious charges of operating unregistered commodity pool and trading advisor schemes, involving solicitation fraud, misappropriation of funds, and issuance of fake account statements. He promised unrealistic monthly returns of up to 100% with no risk, while misusing most investor money for personal expenses and payments to earlier participants in a Ponzi-like manner. A prior criminal record included a 1995 prison term for bad check offenses.

Customer Feedback

No widespread public consumer review platforms feature recent or aggregated feedback on Brown or his firm, likely due to the scheme’s age and legal closure. Victim statements from court proceedings highlighted betrayal after building personal trust—often during vulnerable periods—leading to significant financial losses described as life savings. Negative sentiment focused on deception via charm and fabricated success stories; no positive accounts surfaced.

Risk Considerations

Financial risks include total loss of invested capital, as nearly all funds were misappropriated or lost in unsuccessful trading. Reputational damage stems from federal convictions and enforcement actions labeling him a fraudster. Legal risks involve permanent bans from commodity-related activities and ongoing restitution obligations.

Business Relations and Associations

Brown primarily operated independently through Ray Brown & Associates, with no documented major partnerships, affiliates, or networks beyond his direct solicitation efforts. He targeted individuals across multiple states via personal outreach, brochures, and online postings.

Legal and Financial Concerns

In civil proceedings, a federal court ordered Brown to pay over $1.27 million in restitution, disgorgement, and penalties. Criminally, he pleaded guilty to wire fraud and was sentenced to 24 months in prison plus additional restitution. No bankruptcy or additional unpaid debts appear in records, but permanent injunctions prohibit future involvement in regulated financial activities.

Risk Assessment Table

Risk Type Key Factors Severity (Low/Med/High)
Financial Loss Misappropriation and failed trading High
Legal Exposure Federal convictions, bans, penalties High
Reputational Fraud labels in official records High
Operational Unregistered status, no legitimacy High
Ongoing Liability Unpaid restitution potential Medium

Ray Thomas Brown’s case highlights classic investment fraud, exploiting trust and false high-yield promises. There were no legitimate operations only deceit, victim losses, and blatant regulatory violations. The risks overwhelmingly outweigh any potential benefits, making involvement extremely dangerous. Investors should always verify professionals through the CFTC or SEC and avoid guaranteed returns. Thorough due diligence is essential to prevent falling prey to similar fraudulent schemes. This case remains a stark warning and a lasting red-flag profile in commodities investing.