US Court Seeks $5.7 Million in Penalty from Binary Options Fraudster
- Around 25,000 investors fell for the fraudulent binary options scheme.
The US Commodity Futures Trading Commission (CFTC CFTC The 1974 Commodity Exchange Act (CEA) in the United States created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud, and abuse trade practices and promotes fairness in futures contracts. The CEA also included the Sad-Johnson Agreement, which defined the authority and responsibilities for the monitoring of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commiss The 1974 Commodity Exchange Act (CEA) in the United States created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud, and abuse trade practices and promotes fairness in futures contracts. The CEA also included the Sad-Johnson Agreement, which defined the authority and responsibilities for the monitoring of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commiss Read this Term) has received a court recommendation for the penalties to be imposed on Peter Szatmari, a binary options fraudster.
In the court document for “finds and recommends” signed by the judges of the US District Court of Hawaii, Szatmari can be ordered to pay $6,258,250 in restitution with an off-set of $1,899,837 paid by his business partner David Sechovicz under the settlement.
This is the same amount lost by the victims who fell for the binary schemes promoted by them.
In addition to that, Szatmari is also ordered to disgorge $1,899,836 with and an additional civil penalty of $5,699,508.
“This amount represents three times Defendant’s gain of $1,899,836.00,” the court document noted. “Plaintiff requests the maximum civil monetary penalty because of the serious nature of Defendant’s misconduct, as well as Defendant’s refusal to participate in these proceedings.”
The fake promotions
The CFTC brought the case against Szatmari and his partner in October 2019, alleging that they “created and disseminated millions of fraudulent solicitations to convince recipients to open and fund binary options trading accounts on websites operated by unregistered, off-Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term brokers.”
According to the original complaint, Szatmari and Sechovicz approached the victims via emails, websites, professional videos, advertisements, and social media and convinced them to open binary options trading account, and in many cases, even to use automated trading software.
The duo promised significant profits to the traders if they use the trading software.
The complaint also detailed that to back their claims, the alleged fraudsters used fake testimony of actors claiming to be making profits by using the advertised software and also showed fake bank and trading accounts.
As per the regulator, Szatmari and his partner received $3.8 million for promoting this software as a flat fee for around 25,000 account openings.
For all the allegations and five charges against the defendant, the court found them to be sufficiently pled, and thus “the sufficiency of the Complaint weighs in favor of default judgment.”
The US Commodity Futures Trading Commission (CFTC CFTC The 1974 Commodity Exchange Act (CEA) in the United States created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud, and abuse trade practices and promotes fairness in futures contracts. The CEA also included the Sad-Johnson Agreement, which defined the authority and responsibilities for the monitoring of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commiss The 1974 Commodity Exchange Act (CEA) in the United States created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud, and abuse trade practices and promotes fairness in futures contracts. The CEA also included the Sad-Johnson Agreement, which defined the authority and responsibilities for the monitoring of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commiss Read this Term) has received a court recommendation for the penalties to be imposed on Peter Szatmari, a binary options fraudster.
In the court document for “finds and recommends” signed by the judges of the US District Court of Hawaii, Szatmari can be ordered to pay $6,258,250 in restitution with an off-set of $1,899,837 paid by his business partner David Sechovicz under the settlement.
This is the same amount lost by the victims who fell for the binary schemes promoted by them.
In addition to that, Szatmari is also ordered to disgorge $1,899,836 with and an additional civil penalty of $5,699,508.
“This amount represents three times Defendant’s gain of $1,899,836.00,” the court document noted. “Plaintiff requests the maximum civil monetary penalty because of the serious nature of Defendant’s misconduct, as well as Defendant’s refusal to participate in these proceedings.”
The fake promotions
The CFTC brought the case against Szatmari and his partner in October 2019, alleging that they “created and disseminated millions of fraudulent solicitations to convince recipients to open and fund binary options trading accounts on websites operated by unregistered, off-Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term brokers.”
According to the original complaint, Szatmari and Sechovicz approached the victims via emails, websites, professional videos, advertisements, and social media and convinced them to open binary options trading account, and in many cases, even to use automated trading software.
The duo promised significant profits to the traders if they use the trading software.
The complaint also detailed that to back their claims, the alleged fraudsters used fake testimony of actors claiming to be making profits by using the advertised software and also showed fake bank and trading accounts.
As per the regulator, Szatmari and his partner received $3.8 million for promoting this software as a flat fee for around 25,000 account openings.
For all the allegations and five charges against the defendant, the court found them to be sufficiently pled, and thus “the sufficiency of the Complaint weighs in favor of default judgment.”