Release: 4755-03
For Release: February 13, 2003

SOUTHERN CALIFORNIA FOREIGN CURRENCY (FOREX) OPERATORS CHARGED WITH FRAUD

Local Foreign-Language Newspapers and Internet Used to Advertise Scam

WASHINGTON, D.C. -- The U.S. Commodity Futures Trading Commission (CFTC) announced today that on February 5, 2003, a federal court in Los Angeles, California, issued an order freezing the assets and preserving the books and records of defendants Ben Ouyang, Yuen Kwong “Anthony” Wong (doing business as IBF Capital Limited Company), and Victco Financial Services, Inc. (Victco).

The court’s order followed the February 5, 2003, filing of a complaint by the CFTC charging the defendants with soliciting customers to invest in illegal, off-exchange foreign currency futures contracts, and with defrauding members of the retail public in connection with the solicitation and trading of those contracts. The complaint alleges that, since at least February 2001, defendants have advertised in local foreign-language newspapers and on the Internet to attract customers to trade illegal, off-exchange foreign currency futures (FOREX) contracts, and also defrauded those customers in a variety of ways.

Specifically, according to the complaint, the defendants:

• issued fictitious account statements to customers;
• falsely stated that Victco’s customer trades were placed with third party dealers;
• falsely guaranteed monthly trading profits;
• falsely led prospective customers to believe that Victco was registered with the CFTC and was a member of the National Futures Association; and
• falsely represented to Victco’s customers that their funds were being deposited in a United Kingdom bank, when in fact, some of their funds were deposited in the defendants’ own bank accounts in Los Angeles County, California.

The CFTC is seeking preliminary and permanent injunctions against each of the defendants, repayment of losses to defrauded customers, a return of any ill-gotten profits and benefits, and civil monetary penalties of up to $120,000, or triple the monetary gain to each defendant, whichever is greater, for each violation of the Commodity Exchange Act.

The following CFTC Division of Enforcement staff members are responsible for this case: John Wise, Bruce Gale, Ed Yoshimura, and Jack Barrett.

A copy of the CFTC complaint and restraining order may be obtained at http://www.cftc.gov/cftc/cftchome.htm.

Media Case Enforcement Contact:
John Wise
CFTC Division of Enforcement
(310) 443-4700

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The CFTC Has Issued A Consumer Advisory Warning the Public of the Risks of Foreign Currency (FOREX) Trading and Foreign Currency Scams

The CFTC has issued a Consumer Advisory (at www.cftc.gov/cftc/cftccustomer.htm) urging the public to scrutinize claims of high-return, low-risk investment opportunities in foreign currency (FOREX) trading. This Consumer Advisory provides "red flags" to look for, and cautionary steps to be taken, before making an investment. The CFTC has also issued Advisories concerning the Commodity Futures Modernization Act of December 2000, and how FOREX firms may lawfully offer foreign currency futures and options trading opportunities to the retail public (see CFTC Press Release 4625-02, March 21, 2002; CFTC Advisory, March 21, 2002; and CFTC Advisory 06-01, February 5, 2001).

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