This story dates back to 2008 if not earlier and I happen to be a bit familiar with this case. This also relates to the dispute between MBFX, mentioned below, and ACM the Swiss broker which was recently denied a Swiss banking license and subsequently acquired by Swissquote Bank, and the police raid which took place at ACM’s offices in 2009. It is possible that this may clear ACM from any wrongdoing if indeed these cases are linked as I suspect.
I’ll try to bring more information later on.
CFTC Charges MXBK Group S.A. de C.V., a Mexican Financial Services Company, and its Forex Trading Division, MBFX S.A., with Defrauding Hundreds of U.S. Customers
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced the filing of an enforcement action in the U.S. District Court for the District of Utah, charging MXBK Group S.A. de C.V., a private Mexican financial services holding company, and its foreign currency (forex) trading division, MBFX S.A., with issuing false customer statements and misrepresenting trading results on their website in connection with their foreign currency (forex) trading enterprise. MBFX Group has never been registered in any capacity with the CFTC.
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The CFTC’s complaint alleges that, from at least 2005 to the present, the defendants accepted at least $28 million from more than 800 U.S. customers for the purpose of trading forex on behalf of customers in pooled accounts. The complaint further alleges that, from June 2008 through April 2009, the defendants reported trading profits when, in fact, they lost approximately $19.4 million. The defendants allegedly reported trading profits in at least eight separate months, when they actually incurred substantial trading losses, often exceeding $1 million per month.
In its continuing litigation, the CFTC seeks restitution, disgorgement of ill-gotten gains, civil monetary penalties, an accounting of defendants’ assets and liabilities, permanent trading and registration bans and permanent injunctions against further violations of the federal commodities laws.
The CFTC’s action arose from a joint CFTC cooperative enforcement investigation with the Federal Bureau of Investigation (FBI), the Internal Revenue Service (IRS) and the Securities and Exchange Commission (SEC). On November 30, 2010, the SEC filed a complementary action in the U.S. District Court for the District of Utah, entitled SEC v. Oram, which alleges violations of U.S. securities laws by three U.S. residents alleged to be involved in the MXBK and MBFX enterprise. The CFTC thanks the FBI, IRS and the SEC for their assistance.
The CFTC Division of Enforcement staff members responsible for this case are William Janulis, Theodore Polley, Melissa Glasbrenner, Scott Williamson, Rosemary Hollinger and Richard B. Wagner.
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