CFTC Orders Two Foreign Firms to Pay $2.5 Million for Illegal Off-Exchange Transactions with U.S. Customers

The Commodity Futures Trading Commission (CFTC) announced that it has filed and settled charges against two foreign firms, Netrios LP Ltd. and Red Acre Ltd., for engaging in illegal off-exchange leveraged or margined retail commodity transactions involving U.S. customers who were not eligible contract participants. Netrios was found to have sold a specialized service that enabled the offering and selling of leveraged retail commodities through offshore platforms targeting U.S. clients without verifying their eligibility. Red Acre provided support to Netrios, knowingly assisting in these unlawful activities. These actions involved activities that are only lawful on a registered exchange, and both firms violated U.S. regulations. The penalties include a $1.75 million fine for Netrios and $750,000 for Red Acre, along with orders to cease and desist from further violations. This enforcement action underscores the ongoing efforts of U.S. regulators to combat illegal trading practices and protect investors.