CFTC Orders Australian Schemers to Pay $192 Million in Fines and Restitution

Senen Pousa, an Australian national, has been under the regulatory limelight as the Commodity Futures Trading Commission (CFTC) announced that it obtained a federal court default judgment Order awarding restitution for defrauded customers, and civil monetary penalties of more than $192 million against defendants Senen Pousa and Investment Intelligence Corporation (IIC).

The case is in connection with an off-exchange foreign currency (Forex ) fraud scheme in which Pousa and IIC defrauded over 960 clients in the United States and abroad of over $32 million.

The Order was handed down by Judge Lee Yeakel of the U.S. District Court for Western District of Texas on November 27, 2013. Pousa and his agents were given a default judgment and permanent injunction Order, which requires Pousa and IIC to pay restitution, plus prejudgment interest, totaling $33,299,821 to defrauded customers and Pousa and IIC each to pay a $79.5 million civil monetary penalty. The Order also imposes permanent trading and registration bans against Pousa, and prohibits him from further violating the Commodity Exchange Act (CEA) and a CFTC regulation, as charged.

Clients first filed complaints to the authorities in May 2012, during this time clients suffered a loss of over 60% of their investment, when IIC, by and through its agents, entered over 200 forex trades in each client’s account in violation of the representations made by IIC, by and through its agents. In addition, the Order stems from a CFTC Complaint filed on September 18, 2012, that charged Pousa and IIC with fraud, misappropriation, and other CEA violations.

Details in the official notification state that IIC and Pousa used a range of mediums to attract users to their scheme. The Order finds that, from at least January 1, 2012, IIC, through Pousa and its other agents, utilized “wealth creation” webcasts, webinars, podcasts, emails, and other online seminars via the Internet to directly and indirectly, fraudulently solicit actual and prospective clients worldwide to open Forex Trading accounts at IIC. The Order further enters findings of fact and conclusions of the law finding Pousa and IIC liable as to all violations, as alleged in the CFTC complaint.

The international fraud was investigated by regulators in the UK, USA, Hungary, Australia and New Zealand.