An investigation into illegal trading on the floor of the New York Mercantile Exchange has resulted in criminal charges against seven people, including a former director of the exchange, officials announced yesterday.

Steven Karvellas, who while with NYMEX for about 10 years served as a director of the exchange and a chairman of two of its regulatory committees, has pleaded guilty to two felony charges for what officials described as “front-running” natural gas trades, the Manhattan district attorney, Robert Morgenthau, said. Calling Karvellas “the fox in the chicken house,” Mr. Morgenthau said he delayed the execution of customer orders so that he could monitor the direction of the market. If trades appeared profitable, he would allocate the contracts to himself instead of to his clients, enabling him to essentially engage in risk-free trading, he said.

Karvellas, who is the owner of a natural gas trading company, Steven J. Karvellas and Co., and a brokerage service, Commercial Brokerage Corp., will serve five months in prison and pay back $850,000 in profits as part of a plea deal reached with the district attorney’s office, officials said.

While the investigation into illegal trading at NYMEX has led to charges against seven people, in each case the suspects operated as lone wolves, the director of enforcement of the Commodity Futures Trading Commission, Gregory Mocek, said.

Three others, Thomas Maloney, Brian Keane, and Ryan Tremblay, have already pleaded guilty to charges similar to those faced by Karvellas, officials said. Defendants John Kozlik and Al Demicoli have been charged with related crimes, and a third suspect, Alvin Perez, was arrested for taking bribes in exchange for offering information regarding the investigation, officials said.

Investigators dug up evidence that Karvellas executed the illegal trades between September 2002 and May 2003, according to court documents. At the time, Karvellas was serving as both a member of the board of directors at NYMEX and a chairman of the exchange’s Compliance Review Committee and its Adjudication Committee, officials said.

In addition to performing illegal trades, Karvellas pleaded guilty to tampering with physical evidence. He admitted to ordering an underling to destroy a trading ticket that would have proved incriminating, officials said.

While millions of dollars were likely involved in Karvellas’s illegal trades, an exact figure is unavailable, Mr. Morgenthau said. Investigators admitted that the $850,000 in profits that Karvellas has agreed to repay is a conservative estimate of how much he actually stole.

The two felony charges to which Karvellas pleaded guilty carry a maximum jail term of four years. A judge will likely give him the five-month sentence, agreed upon with the district attorney’s office, when he is sentenced September 9.

Maloney, who owned the trading company Maloney Trading, agreed to a plea deal in which he will pay $75,000 in fines and serve probation. Keane, a former clerk for Power Futures Trading Inc., will serve four months in prison, and Tremblay, who worked as a clerk for a number of companies at the Exchange, will be sentenced to probation.