Forex Trading

California Resident and His Firm Ordered to Pay $9M in Forex Fraud Case: CFTC


A US federal court has ordered a Californian individual and his company to pay $9 million in a forex fraud case, granting
the commodities regulator victory over the matter. The Commodity Futures Trading Commission (CFTC)
announced today (Monday) that the court had ordered Eshaq Nawabi and his
company, Hyperion Consulting Inc., to pay the sum of money in restitution and
penalties.

This ruling marked 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 has directed Nawabi and his firm to pay $4.5 million in restitution to victims and $4.5 million in civil monetary penalty.

According to the CFTC, the court found that from around October 2019 through
April 2022, Nawabi and Hyperion Consulting Inc. deceived traders by promising
substantial profits ranging from 8% to 25% per month with minimal risk. They claimed to trade forex using the deposited funds and assured participants they could withdraw their money within a short timeframe
upon request.

CFTC wrote: “Today’s order follows a prior consent
order the court entered on December 6, 2023, which, in addition to finding the
defendants liable for fraud, enjoins them from future violations of the
Commodity Exchange Act and CFTC regulations, as charged in the complaint, and
permanently bans them from registering with the CFTC and trading on any
registered entity.”

Failure to Return Funds

Instead of fulfilling their promises, the
defendants misappropriated the funds for Nawabi’s personal gain and to pay
other participants, operating in a manner resembling a Ponzi Scheme. To cover up their misdeeds, the defendants reportedly distributed
false account statements, and despite
repeated requests, they failed to return the funds to the participants.

“To conceal their misappropriation, the defendants created and issued false account statements that misrepresented trading returns the pool participants supposedly earned. The defendants failed to return funds to the pool participants despite repeated requests,” the CFTC added.

The commodities regulator has warned that the recovery of lost funds may
not always be possible, as wrongdoers might lack sufficient assets. Thus, the
regulator has urged individuals to verify a company’s registration with the
commission before investing funds.

A US federal court has ordered a Californian individual and his company to pay $9 million in a forex fraud case, granting
the commodities regulator victory over the matter. The Commodity Futures Trading Commission (CFTC)
announced today (Monday) that the court had ordered Eshaq Nawabi and his
company, Hyperion Consulting Inc., to pay the sum of money in restitution and
penalties.

This ruling marked 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 has directed Nawabi and his firm to pay $4.5 million in restitution to victims and $4.5 million in civil monetary penalty.

According to the CFTC, the court found that from around October 2019 through
April 2022, Nawabi and Hyperion Consulting Inc. deceived traders by promising
substantial profits ranging from 8% to 25% per month with minimal risk. They claimed to trade forex using the deposited funds and assured participants they could withdraw their money within a short timeframe
upon request.

CFTC wrote: “Today’s order follows a prior consent
order the court entered on December 6, 2023, which, in addition to finding the
defendants liable for fraud, enjoins them from future violations of the
Commodity Exchange Act and CFTC regulations, as charged in the complaint, and
permanently bans them from registering with the CFTC and trading on any
registered entity.”

Failure to Return Funds

Instead of fulfilling their promises, the
defendants misappropriated the funds for Nawabi’s personal gain and to pay
other participants, operating in a manner resembling a Ponzi Scheme. To cover up their misdeeds, the defendants reportedly distributed
false account statements, and despite
repeated requests, they failed to return the funds to the participants.

“To conceal their misappropriation, the defendants created and issued false account statements that misrepresented trading returns the pool participants supposedly earned. The defendants failed to return funds to the pool participants despite repeated requests,” the CFTC added.

The commodities regulator has warned that the recovery of lost funds may
not always be possible, as wrongdoers might lack sufficient assets. Thus, the
regulator has urged individuals to verify a company’s registration with the
commission before investing funds.



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