The SECannounced an emergency asset freeze against an unregistered money manager and his companies in Plano, Texas, who are charged with defrauding investors in a foreign currency exchange trading scheme.
The forex market is a large and generally liquid financial market in which the risk of loss for individual investors can be substantial. The SEC has previously warned individual investors about the risks involved with forex trading.
The SEC alleges a forex trader raised more than $7.1 million from investors by touting a sophisticated low-risk forex trading strategy yielding astronomical returns. He advertised his purported "25-year Wall Street career." In reality, the forex trading has incurred losses of investor funds, and the forex trader actually spent only six years as a licensed securities professional in Houston before being barred by the New York Stock Exchange two decades ago. The forex trader also lied about his education. Meanwhile, he has siphoned away more than $1.7 million of investor money to pay personal expenses, finance expensive trips, and fund other unrelated and undisclosed businesses and investments.
"[The forex trader] and his companies brandished phony credentials and a can't-miss trading strategy to lure investors into a web of deceit," said David Woodcock, Director of the SEC's Fort Worth Regional Office. "In reality, [the forex trader] was suffering forex trading losses and putting investor money to other uses."
The Commodity Futures Trading Commission(CFTC) today announced parallel charges against the forex trader and his companies.
According to the SEC's complaint that was unsealed late yesterday in U.S. District Court of the Eastern District of Texas, [the forex trader] raised investor money through two entities that he owns and controls: KGW Capital Management and Revelation Forex Fund. KGW Capital purports to be "one of the world's leading private investment firms."
For more information, visit SEC Halts Texas-Based Forex Trading Scheme.
---------
The attorneys at Sallah Astarita & Cox, LLC include veteran securities litigators and former SEC Enforcement Attoreys. We have decades of experience in securities litigation matters, including the defense of enforcement actions. We represent firms and brokers nationwide. For more information contact Mark Astarita at 212-509-6544 or at mja@sallahlaw.com
---------
The attorneys at Sallah Astarita & Cox, LLC include veteran securities litigators and former SEC Enforcement Attoreys. We have decades of experience in securities litigation matters, including the defense of enforcement actions. We represent firms and brokers nationwide. For more information contact Mark Astarita at 212-509-6544 or at mja@sallahlaw.com
