September 27, 2018

CFTC Files Ten Enforcement Actions: Nine Addressing Fraudulent Binary Options Solicitations and One Addressing Cross-Exchange Manipulation

Washington, DC — The Commodity Futures Trading Commission (CFTC) issued seven orders today filing and simultaneously settling charges against various respondents, and also filed two complaints against various defendants, for violations of the Commodity Exchange Act (CEA) and Commission Regulations (Regulations) relating to fraudulent binary options solicitations, and one order filing and simultaneously settling charges for violations of the Act and Regulations relating to cross-exchange manipulation, as set forth below and as more fully described in the related press releases linked below. 

Actions Filed Today

CFTC Charges Eleven Individuals and Five Entities in Nationwide Binary Options Fraud Ring:  As Alleged in Two Complaints and Seven Orders, Hundreds of Millions of Prospective Customers Received Fraudulent Binary Options Solicitations from Defendants and Respondents 

The CFTC today announced that it filed two complaints in federal district courts in Florida against four individuals and three entities and issued seven administrative orders filing and simultaneously settling charges against seven individuals and two entities relating to global retail binary options fraud that victimized U.S. residents.  As alleged in the complaints and found in the orders, the defendants and respondents participated in retail binary options fraud through their involvement in an activity known as “affiliate marketing,” a form of performance-based marketing that is predominantly conducted via email solicitations and promotional materials such as videos made available on internet websites.  The fraudulent solicitations were disseminated to and/or viewed by hundreds of millions of prospective customers in total with approximately one hundred thousand (100,000) customers opening binary options trading accounts and funding those accounts with at least twenty-five million dollars ($25,000,000) in initial deposits.  (Read more here)

CFTC Charges Futures Trader with Cross-Exchange Manipulation

The CFTC today issued an order filing and simultaneously settling charges against Davis Ramsey, a Florida-based futures trader, for employing a manipulative scheme to influence the prices of certain futures contracts traded on the Chicago Mercantile Exchange, Inc. (CME) and Commodity Exchange, Inc. (COMEX), both Designated Contract Markets operated by the CME Group, Inc. (CME Group), to impact the outcome of related binary contracts traded on the North American Derivatives Exchange (Nadex).  The order requires Ramsey to pay a $325,000 civil monetary penalty, $250,636.25 in disgorgement, and imposes a trading ban, as set forth in the order, for a period of five years from the date of the order, as well as a permanent ban from trading on Nadex.   (Read more here)