US defendant told to pay up after multi-million dollar forex fraud

Chris Lee
Commodity Futures Trading Commission

A man from the US has been told that he will need to pay restitution fees of almost three-quarters of a million dollars in connection with a foreign exchange trading scheme that turned out to be fraudulent.

According to the Commodity Futures Trading Commission, or CFTC, Kelvin Ramirez was responsible for the solicitation and misuse of client funds as part of a foreign exchange trading system.

The CFTC claimed that Ramirez was responsible for finding over 400 clients and pushing them to invest in his schemes.

In a statement, the CFTC said that Ramirez “absconded with his clients’ money” to the tune of six figures.

“Ramirez fraudulently solicited more than 400 clients to (1) invest in commodity pools that purportedly trade in forex, (2) trade forex through accounts managed by Ramirez, and (3) subscribe to Ramirez’s forex trading education and signals service, then misappropriated the funds provided to him for these purposes”, the CFTC said.

It also pointed out that, in a common trick used by defendants accused of this sort of crime, social media was a big part of Ramirez’s actions.

It is believed that he utilised WhatsApp, Instagram and other services to promote his fake products.

He created an image of a lifestyle that was designed to trick people into investing. According to the CFTC, he used this platform to reveal large bank balances and his “lavish” lifestyle.

However, this turned out to not be accurate. “The court found that all of these representations were false and that the defendant absconded with his clients’ money. In total, Ramirez fraudulently solicited and misappropriated over $735,000”, the CFTC said.

Ramirez, who received the judgement against him following a CFTC enforcement action in the US District Court for the Southern District of Texas, will now need to pay up a total of $735,983.48 in restitution fees alone to the clients he defrauded.

He will also be hit with a $2.2 million civil monetary penalty as a result of the action. His trading career has also been brought to an abrupt end, and he will no longer be able to register with the CFTC or take advantage of any market trading opportunity which is regulated by it.

He has been banned from pursuing any sort of activity that breaks the Commodity Exchange Act – which is the source of regulation for the country’s commodities markets.

At the end of its statement, the CFTC highlighted some bad news for those who did invest in Ramirez’s schemes and warned that they may never see their cash.

“The CFTC cautions victims that restitution orders may not result in the recovery of money lost because the wrongdoers may not have sufficient funds or assets”, it said.

“The CFTC will continue to fight vigorously for the protection of customers and to ensure the wrongdoers are held accountable.”

In a sign of how international the operation was, the CFTC praised a regulator from abroad for its help.

“The CFTC thanks and acknowledges the assistance of the St. Vincent and the Grenadines Financial Services Authority”, it said.

Chris Lee

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