The Commodity Futures Trading Commission (CFTC), a leading financial regulator in the United States has reported a judgement against Patrick Cole. The US District Court for the Northern District of Ohio issued a Memorandum Opinion, a Judgement Entry and a permanent injunction Order against Cole. The Canadian fraudster is to pay disgorgement of $1,146,399 and his company Global Strategic Marketing,(GSM) is to pay civil monetary penalties of $1.146,399. The judgement highlights the commitment the US regulator shows in combating financial crimes against its citizens.
Liquidity Constraints in 2021 – What is the Best Path Forward?Go to article >>
The case is related to another serious FX related scam which saw defendants pay over $23 million in penalties. Complete Developments, LLC (CDL), and people associated with the firm were fraudulently soliciting a large sum of money from hundreds of individual investors to open “professionally managed” accounts for the purpose of trading off-exchange forex contracts. CDL and GSM were working as partners, the CFTC Order states.
Finer details of the case show that GSM, the marketing firm behind the managed accounts failed to verify data and statements that were presented by CDL. In addition, the firm promoted lucrative incomes, with statements that claimed: “Guaranteed return of principal and high rates of return on investment.” The firm sold its solution to investors with claims that it had carried out its ‘homework’ when in fact the firm had not verified the accuracy of the statements provided by CDL.
Since the infamous Madoff case, Ponzi schemes have been a buzzword as regulators look hard to ensure investors are not caught out. The CFTC has been actively pursuing FX related schemes. The financial watchdog has tried to raise awareness and has dedicated pages on its website with information on the numerous dangers of financial fraud.