The U.S. derivatives regulator alleged that between June 2008 and 2014, Hartshorn engaged in a fraudulent scheme that netted nearly $906,000 from at least 13 retail investors
A New York court has granted the US Commodity Futures Trading Commission’s motion for a default judgment against Florida resident Brett G. Hartshorn, who operated a foreign-exchange scam for over six years.
Specifically, the U.S. derivatives regulator alleged in its complaint that from June 2008 to around 2014, Hartshorn engaged in a fraudulent scheme that netted nearly $906,000 from at least 13 retail investors. As such, the order requires that he pay restitution of $890,000 and imposes permanent trading and registration bans.
In connection with the promotion of his pool, Hartshorn made a series of materially false claims to lure investors interested in forex trading. The claim was made that pool participants could get extraordinary investment returns. While he was actually running risky trading strategies that suffered significant trading losses, Brett claimed that he had profitably traded forex on behalf of himself and others.
In addition, Hartshorn did not disclose to clients that under his so-called “profit” sharing agreement he will charge some fees, even if losses accumulated in their accounts.
In a parallel criminal action, in some cases instead of using the investors’ monies in trading, the fraudster misappropriated at least $57,414 which was largely spent on personal expenses.
Finally, the CFTC warned victims that although it works closely with authorities to seek prompt return of all misappropriated funds, wherever situated, they may not recover their lost money because the wrongdoers may not have sufficient funds or assets.
The Commission also said it has collaborated with several regulators from various jurisdictions. The CFTC has therefore thanked the Federal Bureau of Investigation (Sarasota, Florida) and the U.K. Financial Conduct Authority for their assistance.
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