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Press Release

Former Commodities Trader Charged with Multimillion-Dollar Investment Scheme

For Immediate Release
U.S. Attorney's Office, District of New Jersey

NEWARK, N.J. –  A Chicago man was arrested today and charged in an investment fraud scheme that defrauded victims of over $2 million, a U.S. Attorney Philip R. Sellinger announced.

Phillip Galles, 57, of Chicago, is charged by complaint with one count of wire fraud. Galles made his initial appearance this afternoon before U.S. Magistrate Judge Gabriel A. Fuentes in Chicago, Illinois, federal court and was detained. 

According to documents filed in this case and statements made in court:

Galles, a former commodities trader, defrauded his victims by falsely claiming that he would invest their money in commodity futures through his purported investment company called Tyche Asset Management, based in Chicago. Galles and those working for him falsely told prospective investors that Tyche had a history of success using proprietary trading strategies, with extraordinary annual rates of return exceeding 100 percent.

Tyche made virtually no legitimate investments in commodity futures or otherwise.  Galles instead ran Tyche like a Ponzi scheme and used investor money to pay back other investors and for his own personal expenses.

Galles met in New Jersey with an undercover agent purporting to be an investment manager looking to make a large investment. Galles falsely claimed that Tyche had annual returns of 336 percent, raised over $2 billion within 60 days of starting the fund, and had prominent investors, including a Kuwaiti sovereign fund and a well-known owner of a professional sports team. Galles also falsely claimed that he graduated from a prominent university in the Midwest.  

Galles defrauded more than a dozen victims out of more than $2 million.

The count of wire fraud with which Galles is charged is punishable by a maximum penalty of 20 years in prison and a fine of $250,000 or twice the gross gain or loss involved in the offense, whichever is greatest.

U.S. Attorney Sellinger credited special agents of the U.S. Attorney’s Office, under the direction of Special Agent in Charge Thomas Mahoney in Newark; and the inspectors of the U.S. Postal Inspection Service in Newark, under the direction of Postal Inspector in Charge Christopher A. Nielsen, Philadelphia Division, with the investigation leading to the charges. He also thanked the Commodity Futures Trading Commission and the National Futures Association for their assistance.

The government is represented by Assistant U.S. Attorney Carolyn Silane of the Economic Crimes Unit in Newark.

The charge and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.


Updated May 11, 2023

Securities, Commodities, & Investment Fraud
Press Release Number: 23-141