A US federal court has ordered a California individual and his company to pay $9 million in a foreign exchange fraud case, handing a victory to the commodities regulator in the case. The Commodity Futures Trading Commission (CFTC) announced today (Monday) that the court ordered Eshaq Nawabi and his company, Hyperion Consulting Inc., to pay the sum of money as restitution and penalties.
The ruling marks the culmination of a legal battle initiated by the CFTC, which accused Nawabi and his company of engaging in fraudulent activities by soliciting traders to deposit money for Forex trading. The court ordered Nawabi and his company to pay $4.5 million to the victims and $4.5 million in civil penalties.
According to the CFTC, the court found that between approximately October 2019 and April 2022, Nawabi and Hyperion Consulting deceived traders by promising substantial profits ranging from 8% to 25% per month with minimal risk. They pretended to trade Forex
Forex
Foreign exchange or forex is the act of converting the currency of one country into the currency of another country (which has a different currency); for example, converting from British pounds to US dollars, and vice versa. The exchange of currencies can be carried out on a physical counter, such as in a Bureau de Change, or on the Internet via brokerage platforms, where speculation on currencies, called forex trading, takes place. The foreign exchange market, by its very nature, is the largest trade in the world
Foreign exchange or forex is the act of converting the currency of one country into the currency of another country (which has a different currency); for example, converting from British pounds to US dollars, and vice versa. The exchange of currencies can be carried out on a physical counter, such as in a Bureau de Change, or on the Internet via brokerage platforms, where speculation on currencies, called forex trading, takes place. The foreign exchange market, by its very nature, is the largest trade in the world
using the deposited funds and assured participants that they would be able to withdraw their money within a short time upon request.
The CFTC wrote: “Today's order follows a prior consent order that the court entered on December 6, 2023, which, in addition to finding defendants liable for fraud, prohibits them from future violations of the Commodity Exchange Act and CFTC regulations, as set forth in law. complaint, and definitively prohibits them from registering with the CFTC
CFTC
In the United States, the Commodity Exchange Act (CEA) of 1974 created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud and abusive trading practices and promotes fairness in futures trading. The CEA also included the Sad-Johnson Agreement, which defined authority and responsibilities for oversight of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commission.
In the United States, the Commodity Exchange Act (CEA) of 1974 created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud and abusive trading practices and promotes fairness in futures trading. The CEA also included the Sad-Johnson Agreement, which defined authority and responsibilities for oversight of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commission.
and trade on any registered entity.
Federal court orders California man and his company to pay $9 million in restitution and penalties for #ForexFraud: https://t.co/VKn1gjI3g1
– CFTC (@CFTC) April 15, 2024
Failure to return funds
Instead of keeping their promises, the defendants misappropriated the funds for Nawabi's personal gain and to pay other participants, acting in a manner that resembles a Ponzi scheme. To conceal their misdeeds, the defendants allegedly distributed false account statements and, despite repeated requests, did not return the funds to the participants.
“To conceal their embezzlement, Defendants created and published false account statements that misrepresented the returns on transactions that pool participants were expected to earn. Defendants failed to return funds to pool participants despite repeated requests” , added the CFTC.
The commodities regulator has warned that recovering lost funds is not always possible as criminals may not have sufficient assets. Thus, the regulator urged individuals to check a company’s registration with the commission before investing funds.
A US federal court has ordered a California individual and his company to pay $9 million in a foreign exchange fraud case, handing a victory to the commodities regulator in the case. The Commodity Futures Trading Commission (CFTC) announced today (Monday) that the court ordered Eshaq Nawabi and his company, Hyperion Consulting Inc., to pay the sum of money as restitution and penalties.
The ruling marks the culmination of a legal battle initiated by the CFTC, which accused Nawabi and his company of engaging in fraudulent activities by soliciting traders to deposit money for Forex trading. The court ordered Nawabi and his company to pay $4.5 million to the victims and $4.5 million in civil penalties.
According to the CFTC, the court found that between approximately October 2019 and April 2022, Nawabi and Hyperion Consulting deceived traders by promising substantial profits ranging from 8% to 25% per month with minimal risk. They pretended to trade Forex
Forex
Foreign exchange or forex is the act of converting the currency of one country into the currency of another country (which has a different currency); for example, converting from British pounds to US dollars, and vice versa. The exchange of currencies can be carried out on a physical counter, such as in a Bureau de Change, or on the Internet via brokerage platforms, where speculation on currencies, called forex trading, takes place. The foreign exchange market, by its very nature, is the largest trade in the world
Foreign exchange or forex is the act of converting the currency of one country into the currency of another country (which has a different currency); for example, converting from British pounds to US dollars, and vice versa. The exchange of currencies can be carried out on a physical counter, such as in a Bureau de Change, or on the Internet via brokerage platforms, where speculation on currencies, called forex trading, takes place. The foreign exchange market, by its very nature, is the largest trade in the world
using the deposited funds and assured participants that they would be able to withdraw their money within a short time upon request.
The CFTC wrote: “Today's order follows a prior consent order that the court entered on December 6, 2023, which, in addition to finding defendants liable for fraud, prohibits them from future violations of the Commodity Exchange Act and CFTC regulations, as set forth in law. complaint, and definitively prohibits them from registering with the CFTC
CFTC
In the United States, the Commodity Exchange Act (CEA) of 1974 created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud and abusive trading practices and promotes fairness in futures trading. The CEA also included the Sad-Johnson Agreement, which defined authority and responsibilities for oversight of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commission.
In the United States, the Commodity Exchange Act (CEA) of 1974 created the Commodity Futures Trading Commission (CFTC). The Commission protects and regulates market activities against manipulation, fraud and abusive trading practices and promotes fairness in futures trading. The CEA also included the Sad-Johnson Agreement, which defined authority and responsibilities for oversight of financial contracts between the Commodity Futures Trading Commission and the Securities and Exchange Commission.
and trade on any registered entity.
Federal court orders California man and his company to pay $9 million in restitution and penalties for #ForexFraud: https://t.co/VKn1gjI3g1
– CFTC (@CFTC) April 15, 2024
Failure to return funds
Instead of keeping their promises, the defendants misappropriated the funds for Nawabi's personal gain and to pay other participants, acting in a manner that resembles a Ponzi scheme. To conceal their misdeeds, the defendants allegedly distributed false account statements and, despite repeated requests, did not return the funds to the participants.
“To conceal their embezzlement, Defendants created and published false account statements that misrepresented the returns on transactions that pool participants were expected to earn. Defendants failed to return funds to pool participants despite repeated requests” , added the CFTC.
The commodities regulator has warned that recovering lost funds is not always possible as criminals may not have sufficient assets. Thus, the regulator urged individuals to check a company’s registration with the commission before investing funds.