September 28, 2018

CFTC Files Three Enforcement Actions Addressing Insider Trading; Forex Fraud; and Fraudulent Solicitation, Impersonation of a CFTC Investigator, and Forging CFTC Documents, All in Attempt to Steal Bitcoin

Washington, DC — The Commodity Futures Trading Commission (CFTC) today filed four complaints against various defendants charging violations of the Commodity Exchange Act (CEA) and CFTC Regulations (Regulations), including insider trading; forex fraud; and fraudulent solicitation and impersonating a CFTC official and forging CFTC documents, as set forth below and as more fully described in the related press releases linked below. 

Actions Filed Today

CFTC Charges Block Trade Broker with Insider Trading:  Broker’s Firm Is Also Charged with Supervisory and Recordkeeping Failures

The CFTC today charged EOX Holdings LLC (EOX), an Introducing Broker, and one of its registered Associated Persons, Andrew Gizienski of Houston, Texas (together, Defendants), with insider trading.  In a Complaint filed in the U.S. District Court for the Southern District of New York, the CFTC alleges that Defendants misused material, nonpublic information in connection with block trades of energy contracts on ICE Futures US, in violation of the CEA and Regulations, and also that EOX failed to maintain certain required records and failed to diligently supervise its employees. 

In its continuing litigation, the CFTC seeks civil monetary penalties, permanent registration and trading bans, and a permanent injunction against further violations of the CEA and Regulations, as charged.  (Read more here)

CFTC Charges Georgia-Based Company and Its Chief Executive with Forex Fraud Involving Thirty Customers

The CFTC today charged Lucrative Pips Corporation and its founder and chief executive officer Kevin Perry (together, Defendants), with commodity fraud and misappropriation.  In a Complaint filed in the U.S. District Court for the Northern District of Georgia, the CFTC alleges that Defendants conducted an ongoing off-exchange foreign currency (forex) scheme in which they solicited and misappropriated funds totaling at least $400,000 from at least thirty customers. 

In its continuing litigation, the CFTC seeks disgorgement of ill-gotten gains, civil monetary penalties, restitution, permanent registration and trading bans, and a permanent injunction against further violations of the CEA, as charged.  (Read more here)

CFTC Charges Two Defendants with Fraudulent Solicitation, Impersonation of a CFTC Investigator, and Forging CFTC Documents, All in Attempt to Steal Bitcoin

The CFTC today charged two defendants — one using the name Morgan Hunt, purportedly of Arlington, Texas, and doing business as Diamonds Trading Investment House (Hunt), and the other using the name Kim Hecroft, purportedly of Baltimore, Maryland, and doing business as First Options Trading (Hecroft) — with fraudulent solicitation and other fraud.  In a Complaint filed in the U.S. District Court for the Northern District of Texas, the CFTC alleges that Hunt and Hecroft engaged in a fraudulent scheme to solicit Bitcoin from members of the public, through false or misleading representations or omissions, to invest in trading products including leveraged or margined foreign currency contracts (forex), binary options, and diamonds.  The Complaint additionally alleges that the defendants forged account statements, impersonated a CFTC investigator, and even forged documents purportedly authored by the CFTC’s General Counsel and bearing the image of the CFTC’s official Seal as part of their fraudulent scheme. 

In its continuing litigation, the CFTC seeks restitution to defrauded persons, disgorgement of ill-gotten gains, civil monetary penalties, permanent trading and registration bans, and a permanent injunction against further violations of the CEA and Regulations, as charged. (Read more here)