February 24, 2016
Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced the filing of a civil enforcement Complaint in the U.S. District Court for the Southern District of Florida, charging Defendants Neil Pecker of Longwood, Florida, and his company Vision Financial Partners, LLC (Vision) of Deerfield Beach, Florida, with fraud in connection with off-exchange binary options. The CFTC Complaint also charges Vision and Pecker with acting as a Commodity Trading Advisor (CTA) and as an Associated Person of a CTA, respectively, without being registered with the CFTC, as required.
The Complaint, filed under seal on February 16, 2016, also names as Relief Defendants Prometheus Enterprises, Incorporated; Westward International Limited; Coucarin Holdings, Limited; all of Deerfield Beach, Florida; and GDCM Trust of Las Vegas, Nevada, for allegedly receiving client funds without providing any legitimate services to clients and without any interest or entitlement to such client funds.
Court Freezes Defendants’ Assets
On February 19, 2016, U.S. District Court Judge James I. Cohn entered a Statutory Injunction freezing the assets of Pecker and Vision, prohibiting them from destroying their books and records, and granting the CFTC immediate access to those records.
The Complaint alleges that, from as early as October 2012 through the present, Vision, by and through its sole employee and agent Pecker, and Pecker individually, have fraudulently solicited nearly $3 million from at least 120 members of the public in the United States and Canada to trade off-exchange binary options by making misleading and false misrepresentations and omissions of material facts to prospective and current clients. Furthermore, as alleged, the Defendants misappropriated almost $2 million of client funds for their personal use in connection with their scheme by transferring client funds to the Relief Defendants.
Binary options are options with discontinuous payoffs, either paying nothing or a considerable amount depending on the satisfaction of some condition. According to the Complaint, Pecker and Vision failed to inform clients that their trading accounts are with off-shore entities and that clients are unable to withdraw any funds from their binary options trading accounts, including their principal investment, unless a minimum of trades occurred in their accounts. Pecker and Vision also are alleged to have misappropriated and diverted almost $2 million of client funds to bank accounts in the names of the Relief Defendants and for their own use. In addition to fraud, the Complaint charges that Pecker and Vision have failed to register with the CFTC, as required.
In its continuing litigation, the CFTC seeks restitution to defrauded clients, disgorgement of ill-gotten gains, civil monetary penalties, permanent registration and trading bans, and a permanent injunction from future violations of the Commodity Exchange Act, as charged.
The CFTC cautions victims that restitution orders may not result in the recovery of money lost because the wrongdoers may not have sufficient funds or assets. The CFTC will continue to fight vigorously for the protection of clients to ensure the wrongdoers are held accountable.
The CFTC thanks the U.K. Financial Conduct Authority, Cyprus Securities and Exchange Commission, St. Vincent and the Grenadines - Financial Services Authority, Ontario Securities Commission, New Brunswick Securities Commission, Cayman Islands Monetary Authority, British Columbia Securities Commission, Alberta Securities Commission, and the British Virgin Islands Financial Services Commission for their assistance in this matter.
CFTC Division Enforcement staff members responsible for this case are Eugenia Vroustouris, Michelle Bougas, Erica Bodin, Elizabeth C. Padgett, Mary Q. Lutz, Elizabeth Davis, and Rick Glaser.
* * * * * * *
See Binary Options Customer Fraud Advisory and “RED” List
The CFTC has issued a Consumer Alert to warn about fraudulent schemes involving binary options and their trading platforms. The Alert warns customers that the perpetrators of these unlawful schemes allegedly refuse to credit customer accounts, deny fund reimbursement, commit identity theft, and manipulate software to generate losing trades.
Also, see CFTC Press Release 7224-15, September 9, 2015: CFTC Publishes List of Foreign Entities that Illegally Solicit U.S. Residents to Trade Foreign Currency and Binary Options; The New Registration Deficient ‘RED List’ Identifies Companies Operating Illegally.
Customers can report suspicious activities or information, such as possible violations of commodity trading laws, to the CFTC Division of Enforcement via a Toll-Free Hotline 866-FON-CFTC (866-366-2382) or file a tip or complaint online.
Last Updated: February 24, 2016