FEDERAL COURT ORDERS LOS ANGELES FOREIGN CURRENCY FIRM AND ITS PRESIDENT TO REPAY CUSTOMERS MORE THAN $1 MILLION IN COMMODITY FUTURES TRADING COMMISSION FRAUD ACTION
Court Also Orders Payment of Over $5 Million in Civil Penalties
WASHINGTON, D.C.-- The U.S. Commodity Futures Trading Commission (CFTC) announced today that a Los Angeles federal district court entered an order of default judgment in its favor against defendants Fintrex, Inc. and Arman Ovsepyan, the President of Fintrex. The order requires those defendants to make repayments to customers of more than $1 million, and to pay a civil penalty resulting from violations of the Commodity Exchange Act (CEA). Both defendants are permanently enjoined from further violating the CEA.
The court’s order, entered on January 29, 2004, results from a complaint filed by the CFTC in the U.S. District Court for the Central District of California on August 14, 2001 (see CFTC News Release 4551-01).
The court’s order of default judgment permanently prohibits defendants Fintrex and Ovsepyan from engaging in further fraudulent conduct and restricts them from offering illegal foreign currency (forex) futures contracts to the public. Fintrex is ordered to repay injured customers $1,320,283, and Fintrex, along with Ovsepyan, is further ordered to repay customers $683,670. Upon satisfaction of their repayment obligations, Fintrex is ordered to pay a civil penalty of just over $4 million, and Ovsepyan is ordered to pay a penalty of $1,367,340.
Court Also Enters Civil Contempt Order Against Defendant Arman Ovsepyan, President Of Fintrex, Inc.
Defendant Ovsepyan is also ordered to purge himself of civil contempt as found in a December 16, 2003, order of the court holding him in civil contempt. The civil contempt order requires Ovsepyan, within 30 days, to: (1) return money he took in violation of an asset freeze order entered shortly after the case was filed, (2) repatriate assets located outside the United States, (3) provide the CFTC with a detailed accounting of his funds, and (4) make books and records available to the CFTC for examination and copying.
This litigation is part of an ongoing CFTC nationwide crackdown on foreign currency (forex) scams. The CFTC Division of Enforcement staff responsible for this action were: John Wise, Jack Barrett, Lenel Hickson, Jr., Stephen J. Obie, and Vincent A. McGonagle.
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