CFTC Penalizes Wisconsin Consultant Mark Hendershott for Operating as an Unregistered Commodity Trading Advisor

The Commodity Futures Trading Commission (CFTC) has issued an order requiring Mark Hendershott, a self-employed consultant based in Wisconsin, to pay a $75,000 civil monetary penalty. The regulatory action penalizes Hendershott for operating as an unregistered commodity trading advisor (CTA) in violation of federal commodity laws. According to the CFTC's findings, Hendershott violated Section 4m(1) of the Commodity Exchange Act from approximately May 2018 through at least June 2021. During this timeframe, he used interstate commerce—including the internet, telephone, and email—to run a commodity advisory business without obtaining the legally required CFTC registration. Hendershott primarily provided consulting services to farmers regarding physical crop-related activities. However, he also expanded his offerings into commodity futures hedging. For a flat fee, he counseled clients on using futures contracts to hedge their crop production, focusing on agricultural commodities such as corn, wheat, soybeans, oats, and lean hogs. In addition to offering tailored trading advice, Hendershott actively facilitated the trading process by helping clients open accounts with a CFTC-registered futures commission merchant. The CFTC revealed that he went beyond advising by directly placing orders for futures contracts on behalf of multiple clients. He also handled margin and credit issues and coordinated fund transfers between clients' bank accounts and trading accounts. The regulatory agency emphasized that Hendershott conducted these transactions without holding a power of attorney or any written agreement granting him authority to trade on his clients' behalf. Because he marketed his services as a CTA, advised more than 15 individuals within a 12-month span, and utilized interstate communications, he was legally obligated to register with the CFTC. Investors and market participants are advised to verify the registration status and credentials of any financial advisor or trading manager before granting access to funds or trading accounts.