Regulatory Violations

December 16, 2016

The SEC announced on-going cease and desist proceedings against Utah-based broker dealer Wilson-Davis & Co, and settled proceedings against a former Wilson-Davis proprietary trader, Anthony Kerrigon, Wilson-Davis’ vice president/head trader Byron Barkley, and Wilson-Davis’ Chairman/CEO Paul Davis for violations of Regulation SHO.  Regulation SHO requires that before a broker-dealer effects a short sale, the broker-dealer must “locate” a source of borrowable securities that can be delivered on the date that delivery is due.  The rule includes a limited exception for short sales executed in connection with bona fide market making.  The SEC alleges that from at least November 2011 to May 2013, Wilson-Davis relied on the bona-fide market making exception for all short sales by its proprietary trading group and that this reliance was improper for certain trades.  While improperly availing itself of the exception, Wilson-Davis engaged in numerous short sales in over-the-counter equity securities which violated Rule 203(b)(1) of Regulation SHO and resulted in improper trading profits.  In addition, Wilson-Davis violated various provisions of the Market Access Rule.  Kerrigone, Barkley, and Davis will pay, collectively, over $700,0000 to settle the charges against them.  SEC

January 9, 2017

EJS Capital Management, LLC,  Alex Vladimar Ekdeshman, and Edward J. Servider were ordered to pay over $11.6 million in sanctions for their role in a fraudulent, off-exchange foreign currency scheme involving misappropriation of customer funds and false statements to customers to conceal the fraud. The order was entered by the United States District Court for the Southern District of New York. A number of Relief Defendants were ordered to pay $760,375 in disgorgement. CFTC

December 28, 2016

The CFTC filed a civil enforcement action against Brett G. Hartshorn for fraudulently soliciting/managing at least $906,000 to invest in off-exchange foreign currency. Hartshorn is charged with misappropriating at least $57,414 of client funds, failing to register with the CFTC as a Commodity Trading Advisor, and failing to produce books and records to the agency. CFTC

November 16, 2016

IB Capital FX, LLC (a/k/a IB Capital FX (NZ) LLP) d/b/a IB Capital, Michel Geurkink, and Emad Echadi, were ordered to pay $35 million in restitution to defrauded customers and a $420,000 civil monetary penalty for soliciting and accepting at least $50 million from approximately 1,850 customers for off-exchange margined retail foreign currency trading without being registered with the CFTC.  CFTC

October 19, 2016

The Yorkshire Group, Inc. and its principal Scott Platto were ordered to pay over $1.5 million in penalties and restitution for engaging in an illegal off-exchange precious metals transaction scheme.  CFTC

September 30, 2016

The CFTC filed a civil enforcement action against Alcibiades Cifuentes and Jennifer Wee Cifuentes, both of West New York, New Jersey, and Cifuentes Fund Management, LLC, alleging the defendants engaged in an off-exchange, leveraged or margined retail foreign currency fraud, commodity pool fraud, and failed to register with the CFTC.  CFTC

September 29, 2016

Angus Partners LLC (d/b/a Angus Energy), a Florida limited liability company with its principal place of business in Fort Lauderdale, Florida, was ordered to pay a $250,000 civil monetary penalty for acting as an unregistered Commodity Trading Advisor and for violating certain disclosure rules applicable to such advisors.  CFTC

September 29, 2016

The CFTC ordered Aden Rusfeldt (a/k/a “Big A”) of Vail, Arizona, to pay over $3.2 million in penalties and restitution for failing to disclose to prospective and current customers of his company, ETF Trend Trading, that he was prohibited by court order from engaging in any commodity-interest related activities.  CFTC

September 28, 2016

The CFTC filed a complaint against eFloorTrade, LLC and its majority owner and sole principal John Moore, charging them with record keeping and supervision failures and charging Moore with making false and misleading statements of material fact, or omitting material facts, in sworn testimony before the CFTC.  CFTC

September 27, 2016

The CFTC filed a civil enforcement action against Kevin Michael Symons of Foothill Ranch, California, his wholly-owned company, FTS Financial, Inc. of Irvine, California, and Jerry Austin Simmons of Charlotte, North Carolina, charging them with the fraudulent promotion of Simmons’ “Real Time Trade Room," an online futures “trading” forum marketed by Defendants as a way to observe Simmons as he purported to trade futures contracts “live.” Additionally, the CFTC’s complaint charges Simmons with soliciting clients to open managed futures trading accounts without being registered with the CFTC as an Associated Person of a Commodity Trading Advisor.  CFTC