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Tag: Dodd-Frank Act

  • URGENT >> BULLETIN >> MOVING: CFTC Files Actions In Utah, Wyoming, New York And Illinois Against Domestic AND Offshore Firms In Second Phase Of Forex Sweep; 11 Companies Accused Of Illegally Soliciting U.S. Customers

    URGENT >> BULLETIN >> MOVING:

    UPDATED 8:14 P.M. EDT (U.S.A.) The Commodity Futures Trading Commission has gone to federal courts in four different states and simultaneously filed actions against 11 separate companies in the second phase of an enforcement sweep.

    The firms, some of which conduct business offshore but allegedly use webhosting companies or other service-providers in the United States,  are accused of illegally targeting U.S. customers. In addition to today’s actions against 11 firms, 14 companies were charged in January, bringing the sweep total to 25.

    Not all of the firms charged today used U.S.-based webhosts or service-providers or had a physical footprint in the United States, according to court records. At least one of the firms used the services of technology companies in Hong Kong and Canada, but all of the firms allegedly had the capacity to transact business with U.S. customers over the Internet.

    “These actions reflect the CFTC’s continued resolve to make the forex market safer for investors by strictly enforcing the CFTC’s new forex regulations, which became effective in October 2010,” said David Meister, CFTC’s director of enforcement. “These new regulations require entities that wish to participate in the forex market to register with the CFTC and abide by regulations that are intended to protect the public from potentially fraudulent operations.”

    Named defendants in today’s announced cases were:

    • 1st Investment Management LLC, a Wyoming LLC.
    • City Credit Capital (UK) Ltd., a United Kingdom company.
    • Enfinium Pty Ltd., an Australian company.
    • GBFX LLC, a New York LLC.
    • Gold & Bennett LLC, a New York LLC.
    • InterForex Inc., a British Virgin Islands company.
    • Lucid Financial Inc., a Utah corporation.
    • MF Financial Ltd., a Belize company with offices in New York City.
    • O.C.M. Online Capital Markets Limited, a British Virgin Islands company.
    • Trading Point of Financial Instruments Ltd., a Cyprus company.
    • Windsor Brokers Ltd., a Cyprus company.

    The agency said it “strongly urges the public to check whether a company is registered before investing funds. If a company is not registered, an investor should be wary of providing funds to that company.”

    Registrations can be checked through the National Futures Association.

    CFTC said today that it received assistance in its probe from the U.S. Attorney’s Office for the District of Wyoming, the Utah Attorney General’s Office, the Utah Division of Securities and the U.K.  Financial Services Authority.

    Each of of the firms was charged with violating provisions of the Dodd-Frank Act and other U.S. laws.

    Here is a link to a CFTC page through which all of today’s complaints can be accessed. (Look on the right side of the page.)

     

  • BULLETIN: CFTC Conducts Major Sweep; 14 Forex Firms Accused Of Illegal Solicitation Of U.S. Citizens; Actions Filed In New York, Chicago, D.C. And Kansas City

    BULLETIN: The Commodity Futures Trading Commission has gone to federal courts in New York, Chicago, the District of Columbia and Kansas City and simultaneously filed 14 lawsuits against Forex companies to enforce registration requirements and provisions of the Dodd-Frank Act.

    One of the lawsuits — one filed in the District of Columbia against a Nevada company known as Kingdom Forex Trading and Futures Ltd. that claims to be a “legally registered company in Belize and Nevis” — alleges that the firm was not registered with the CFTC but that U.S. customers were instructed to send money via wire and credit/debit cards.  Money also can be sent by Liberty Reserve, a payment processor favored by online financial schemes. Liberty Reserve says it operates from Costa Rica.

    The case against Kingdom Forex has been assigned to U.S. District Judge Rosemary Collyer, the same judge assigned to hear the AdSurfDaily autosurf Ponzi scheme cases.

    This morning, Liberty Reserve was advertising on its website a company known as FXOpen.com. FXOpen.com, according to the CFTC, is the website of a firm known as FXOpen Investments Inc. — yet-another of the defendants sued in the sweep.

    FXOpen is described in the complaint as “company of undisclosed origin” that claims “its headquarters is located at Ebene Heights No. 34, Cybercity Ebene, Mauritius.”

    It also claims to have “worldwide regional offices” in Cairo, Egypt; Paris, France; Kuala Lumpur, Malaysia; Jakarta, Indonesia; Almaty, Kazakhstan; and Moscow, Russia, CFTC charged.

    “FXOpen’s websites, including www.fxopen.com, are hosted on servers” in the United States, CFTC charged in the complaint.

    The firm, whose website would not load this morning when visitors clicked the link at the Liberty Reserve page, is accused of directly soliciting U.S. investors and claiming U.S. law does not apply to it.

    “[I]n the ‘Forum’ section of its website, FXOpen representatives specifically solicit United States residents to open accounts with FXOpen, in part by advertising that potential customers in the United States can escape United States laws and regulations by opening accounts with FXOpen,” CFTC charged.

    “For example, on October 5, 2010, in response to a question regarding whether FXOpen could accept applicants from the United States after October 18, 2010 following recent CFTC rulings, an FXOpen representative answered with a post, stating, ‘Since we don’t have an office in the US, nor are we an affiliate of a US based broker, we are not bound by CFTC rulings. Rest assured we will be able to accept US clients for the foreseeable future unless a legal impediment appears,’” CFTC charged in the complaint.

    All of the companies named defendants in the sweep are accused of “illegally soliciting members of the public to engage in foreign currency (forex) transactions and that they are operating without being registered with the CFTC,” the agency said.

    Among the defendants are domestic and offshore companies.

    Here is the lineup of defendants in what the CFTC described as a major nationwide sweep:

    • EuroForex Development LLC, a Delaware LLC.
    • FIG Solutions Limited Inc., a Delaware corporation.
    • ForInvest, a Delaware corporation.
    • FXOpen Investments Inc., a Delaware LLC.
    • FXPRICE, a Delaware LLC.
    • GIGFX LLC., a Delaware company.
    • InovaTrade. Inc., a company with purported offices in Florida.
    • InstaTrade Corp., d/b/a InstaForex, a British Virgin Islands company.
    • InvesttechFX Technologies. Inc., a Canadian corporation located in Toronto.
    • J&K Futures. Inc., a company with purported offices in California and New York.
    • Kingdom Forex Trading and Futures. Ltd., a Nevada company.
    • Prime Forex LLC, a Delaware LLC.
    • Wall Street Brokers LLC, a Delaware LLC.
    • ZtradeFX LLC, a Connecticut LLC.