November 16, 2015
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) filed a civil enforcement Complaint charging Defendants IB Capital FX, LLC (a/k/a IB Capital FX [NZ] LLP) d/b/a IB Capital (IB Capital), Michel Geurkink, and Emad Echadi, individually and as the agents of IB Capital, with soliciting and accepting at least $50 million from at least 960 clients worldwide, including at least 697 clients in the United States, for off-exchange margined retail foreign currency (forex) trading, without being registered with the CFTC, as required.
The CFTC Complaint alleges that, from at least January 1, 2012 through September 18, 2012, the Defendants engaged in the offering of agreements, contracts or transactions in forex to retail customers who were not eligible contract participants without being registered as required by the relevant provisions in the Commodity Exchange Act (CEA) and the CFTC’s Regulations. In fact, the Defendants have never been registered as required with the CFTC, according to the Complaint. Courts have long recognized that the operation of an unregistered entity is a serious violation of the CEA and CFTC Regulations and is a threat to the integrity of the industry.
The CFTC Complaint seeks restitution, rescission, disgorgement, civil monetary penalties, trading and registration bans, and permanent injunctions against further violations of the registration provisions of the CEA and CFTC Regulations.
The CFTC appreciates the assistance of the Australian Securities & Investments Commission, United Kingdom Financial Conduct Authority, Hungarian Financial Supervisory Authority (which merged with the Central Bank of Hungary [Magyar Nemzeti Bank]), Financial Markets Authority of New Zealand, and the New Zealand Serious Fraud Office.
Further, the CFTC greatly appreciates the assistance of the Securities and Exchange Commission, the Department of Justice, the United States Attorney for the Western District of Texas, and the Federal Bureau of Investigation.
CFTC Division of Enforcement staff members responsible for this matter are Kyong J. Koh, JonMarc P. Buffa, Timothy J. Mulreany, Tashieka Taylor, Elizabeth C. Padgett, Mary Q. Lutz, Doriana V. Ensley, and Paul G. Hayeck.
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CFTC’s Foreign Currency (Forex) Fraud Advisory
The CFTC has issued several customer protection Fraud Advisories that provide the warning signs of fraud, including the Foreign Currency Trading (Forex) Fraud Advisory, which states that the CFTC has witnessed a sharp rise in Forex trading scams in recent years and helps customers identify this potential fraud.
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: November 16, 2015