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Daily fraud update: 14th May

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Man accused of forex fraud reaches payment settlement

A man who was accused of committing a foreign exchange scam by a US regulator has agreed a six-figure sum to pay as a settlement.

As part of the agreement that was reached with the Commodity Futures Trading Commission (CFTC), Brett G. Hartshorn will now have to pay a sum of around $890,000 in restitution.

The proposals are also set to lead to Hartshorn being forever prohibited from carrying out fraud against others.

He will also not be permitted to enter into any transactions that pertain to commodities, and he will also not be permitted to apply to register with the regulator, among a whole host of other bans.

According to allegations from the CFTC, Hartshorn’s fraud focused in part on people who were involved in his church.

He is accused of having solicited payments from 13 or perhaps more people on a fraudulent basis.

He claimed to offer services involving investment in off-exchange, leveraged forex, and sought the right to do this on their behalf.

In 2018, a judge in the New York Southern District Court, Andrew L. Carter, refused to permit a Motion to Dismiss that Hartshorn had filed.

Later that year, the CFTC managed to get a certificate of default against Hartshorn.

According to press reports, Hartshorn has made a number of unusual and emotive statements in court.

At one stage, he is understood to have said that he “is lost”.

He has supposedly also told a court that he had the capacity to “make a positive difference in this world”.

“Your Honor, I know my former best friends have suffered monetary losses, and this is a very hard and horrible thing for them,” he was quoted as having said.

“I have completely lost my life. I have nothing, and I have no idea what to do and how to move forward. I am scared, I don’t sleep hardly at all, I don’t know what to tell my Wife and Children. We are all hanging by a thread. I am lost,” he added.

According to a press release from the CFTC at the time of originally charging Hartshorn, the regulator gave some extra information about how the alleged scam worked.

“Hartshorn typically met his victims at church or socially in his local community, according to the Complaint,” it read.

“As alleged, Hartshorn told most clients that 1) he had profitably traded forex on behalf of himself and others, 2) clients could expect substantial profits if they permitted him to trade forex on their behalf, and 3) he would limit the risk of loss to client funds.”

“However, according to the Complaint, these statements to clients were false because Hartshorn employed risky trading strategies and failed to disclose his pattern and history of losses – often large single-day losses – trading on behalf of clients,” it added.