The United States’ Commodity Futures Trading Commission (CFTC) has taken firm steps against several allegedly fraudulent forex scheme operators that collectively accepted a minimum of $4.75 million from at least 150 participants.
The court documents filed on Wednesday named 5 companies and their operator: Avinash Singh and his company, Highrise Advantage; Randy Rosseau and his company, Bull Run Advantage; Daniel Cologero and his company, Green Knight Investments; Hemraj Singh and his firm, King Royalty; and lastly Surujpaul Sahdeo and his company, SR&B Investment Enterprises, for soliciting and misusing the funds.
The investment scheme by these companies began in or around February 2013 and are still continuing to accept funds.
They operated as pools, while Highrise acted as the master commodity pool, the other 4 were feeder pools as they funneled most of their deposits to Highrise.
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Singh approached investors and other pools as an experienced forex and commodities trader and showed false track records of positive gains with no losses.
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The market regulator alleged that Highrise and its operator Singh traded only a small portion of the collected proceeds and misappropriated more than $3 million for personal expenses. He also made Ponzi-type payments to other pool participants and also handed payouts to the feeder funds.
Additionally, Highrise is accused of issuing and showing false monthly statements to the investors that misrepresented the ‘profits and balances’.
“Green Knight, Bull Run, and King Royalty likewise each issued monthly account statements to their pool participants that misrepresented the profits and balances of the pool participants’ respective interests in the Feeder Pools, as well as the Master Pool,” the court filing noted.
CFTC is now charging the funds for not registering with it as commodity pool operators (CPOs), and for the operations, the funds and its operators allegedly violated the Commodity Exchange Act and other accompanying CFTC regulations.
The regulator is now asking the court to halt these funds’ operations with an injunction and is also seeking civil monetary penalties remedial ancillary reliefs, including trading and registration bans, disgorgement, pre- and post-judgment interest, and rescission.