CFTC Receives Consent Order from $7.2M Forex and Crypto Fraudsters

The Commodity Futures Trading Commission (CFTC) announced on Tuesday that it has received a consent order for its enforcement action against the defendants who pulled off a foreign exchange (forex) and cryptocurrency trading scam, defrauding investors of more than $7.2 million.

The primary accused of the case was Abner Alejandro Tinoco who ran a self-styled investment firm, Kikit & Mess Investments LLC, and misappropriated the funds received from the investors for managed trading activities.

The CFTC first charged Tinoco and his company in October 2010. Initially, the defrauded amount was estimated to be around $3.9 million, but later it was found to be more than $7.2 million.

The 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 order imposed injunctive relief that include permanent bans on Tinoco and his company from trading and registration. Further, they were enjoined from future violations of the Commodity Exchange Act (CEA).

Additionally, the defendants have to provide restitution, disgorgement and a civil monetary penalty, but these figures will be decided by the regulator at a later date.

A Massive Fraud

Tinoco, with his company, has run the fraudulent investment scheme since at least September 2020, according to the CFTC. He managed to gather the funds from at least 322 clients with assurances of managing their customized trading portfolios in forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term and cryptocurrency investments and solicited at least $7.2 million.

He did not even trade with the collected funds. Rather, he used the proceeds to finance his personal expenses including travel costs for chartering a private jet, the purchase of a luxury mansion and other real estates, and the purchase or lease of luxury automobiles.

Tinoco and his company even disguised returns by paying some of the investors with the funds collected from others, making it a classic Ponzi-styled scheme.

Meanwhile, the CFTC is actively busting fraudsters in the field of investment. Earlier this year, the agency settled a binary options fraud for $2.6 million and charged the promoters of another forex scam $58 million.