The US Commodity Futures Trading Commission (CFTC) today charged a Texas-based forex trader in a case involving the operation of a fraudulent investment scheme, according to a CFTC statement.
Kelvin O. Ramirez was accused of taking money from customers who thought they were investing in foreign exchange markets. Customers were lulled into the false belief that they were trading currencies through accounts managed by Ramirez, or by subscribing to his education courses or signals service.
The defendant sold the ‘double your money’ software for as little as $250 per month to receive the basic trading signals and as much as $25,000 to receive the trading signals and other personalized trading advice.
In connection with the promotion of the software, Ramirez made a series of materially false claims through various means, primarily through social media, including Instagram, WhatsApp, and similar channels.
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Multiple fraud counts
Ramirez used several names to hide his identity, according to the complaint that accuses the defendants of fraud, misappropriation, registration violations, and issuing false statements.
The US derivatives regulator alleged in its complaint the money sent to Ramirez was not used to purchase or trade FX on his clients’ behalf. Prosecutors said that instead of buying the contracts ordered by his customers, he spent the money on company expenses, investment activities and for his own personal use and benefit.
As a result of the actions and misappropriation, the commission seeks full restitution to defrauded participants, disgorgement of any ill-gotten gains, a civil monetary penalty, permanent registration and trading bans, and a permanent injunction against violations of federal commodities laws, as charged.
According to James McDonald, the CFTC’s Director of Enforcement, “This case shows the CFTC’s continued commitment to rooting out fraud in our markets, whether it flows through traditional avenues or new ones, like the social-media based scheme alleged here. As social media becomes more prevalent, we caution customers to perform appropriate due diligence regarding any investment solicitations they receive over those platforms.”