regulation
CFTC Orders Texas and Florida Residents to Pay Over $500,000 for Commodity Pool Fraud
The U.S. Commodity Futures Trading Commission (CFTC) has secured court orders requiring residents of Texas and Florida to pay over $500,000 in disgorgement and civil penalties for involvement in commodity pool fraud. The orders also impose trading bans on the defendants.
AS1 NewsSource: cftc.gov
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ALGOThe CFTC announced that the U.S. District Court for the Southern District of Florida entered consent orders against defendants Steven Likos and Archie Rice for engaging in retail fraud and related violations. Likos, acting as a sales agent for Algo Capital LLC, misappropriated customer funds and made false representations about withdrawal rights and proprietary trading algorithms. In reality, Algo Capital arranged for Traders Domain FX Ltd. to trade customer funds, despite red flags indicating fraudulent activity.
Similarly, Rice, soliciting for Centurion Capital Group Inc., misappropriated funds and made false claims about profits and withdrawal capabilities, while privately expressing concerns about the inability of customers to withdraw their funds. Both defendants ignored warning signs of fraud and misrepresentation.
The court ordered Likos to pay $320,041.38 in disgorgement and Rice to pay $227,220 in civil penalties. Additionally, both are permanently enjoined from further violations of the Commodity Exchange Act and related regulations, with trading and registration bans imposed. These orders resolve all claims against Likos and Rice in the ongoing enforcement action, although investigations against other defendants continue.
The enforcement actions highlight ongoing regulatory efforts to combat fraud in commodity pools and related financial activities, emphasizing the importance of compliance and transparency.