DOJ SealDepartment of Justice

United States Attorney Rebecca A. Gregory
Eastern District of Texas

FOR IMMEDIATE RELEASE                                                  CONTACT:  DAVILYN WALSTON
TUESDAY, SEPTEMBER 9, 2008                                           PUBLIC INFORMATION OFFICER
WWW.USDOJ.GOV/USAO/txe                          PHONE: (409) 839-2538 CELL: (409) 553-9881


BEAUMONT, TX—United States Attorney Rebecca A. Gregory announced today that a 57-year-old Nacogdoches man has pleaded guilty to three counts of criminal conduct relating to his operation of a commodity trading pool in the Eastern District of Texas. 
            GEORGE D. HUDGINS pleaded guilty to one count of wire fraud, one count of embezzlement from investors in his commodity pool, and one count of money laundering today before United States District Judge Thad Heartfield.

            According to the information presented in Court, beginning in 2004, through April 2008, Hudgins solicited and accepted funds from numerous investors for the purpose of investing in commodities futures and stock index futures.  To encourage investment, Hudgins provided investors with false and misleading information concerning the pool's historic returns.  Instead of operating at the significant profit levels stated by Hudgins, the pool lost large amounts of money.  Hudgins actually used monies provided to him by investors to pay "profits" to other investors, thus executing what prosecutors describe as a Ponzi scheme.

Hudgins faces up to 20 years in federal prison and a fine of up to $250,000.00.  A sentencing date has not been set.

            This case was investigated by the FBI, the Texas Rangers, the IRS and is being prosecuted by Assistant United States Attorney Malcolm, Bales who has worked closely with attorneys from the Commodity Futures Trading Commission (CFTC).  In fact, the CFTC has also filed a lawsuit which froze existing accounts owned by Hudgins.  All agencies are working closely to insure that the maximum amount of restitution is gathered and paid to the identified victims of this fraud. 

back to top