U.S. Commodity Futures Trading Commission Obtains Federal Court Order Freezing Assets of FX Trading, LLC and Charges Firm with Failing to Maintain Minimum Net Capital Requirements for Registered Futures Commission Merchants
WASHINGTON, DC -- The U.S. Commodity Futures Trading Commission (CFTC) announced today that the federal district court in Newark, New Jersey, issued an order freezing the assets and preventing the destruction of the books and records of defendant FX Trading, LLC (FX Trading), located in Iselin, New Jersey. Approximately $3.5 million in assets were frozen as a result of this action.
The asset freeze order, entered on December 8, 2005, stems from a CFTC enforcement action filed earlier that day alleging that, since at least October 31, 2005, FX Trading has failed to comply with the minimum net capital requirements it must meet as a CFTC-registered futures commission merchant. Among other things, the net capital requirements are designed to ensure customer protection and the financial stability of the marketplace.
In its continuing litigation, the CFTC is seeking injunctive orders, civil penalties, and other relief. The Honorable Jose L. Linares of the U.S. District Court for the District of New Jersey has scheduled a hearing for the CFTC’s motion for a preliminary injunction for mid-January 2006.
The CFTC thanks the staff of the National Futures Association for their assistance in this matter.
The following CFTC staff members are responsible for this case: John Wise, Judith Slowly, John Adair, David Acevedo, Lenel Hickson, Jr., Stephen J. Obie, and Richard B. Wagner.
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The CFTC encourages members of the public to bring to our attention any suspicious activities involving futures or commodity options, including matters involving foreign currency (forex) investments or suspicious Internet websites.
You may contact the CFTC at 1-866-FON-CFTC (1-866-366-2382), visit us at our Customer Protection web page: (www.cftc.gov/cftc/cftccustomer.htm), or fill out our Internet Report Form identifying your concerns (www.cftc.gov/enf/enfform.htm).
In addition, the CFTC publishes a series of Consumer Advisories at http://www.cftc.gov/cftc/cftccustomer.htm#advisory alerting the public to warning signs of possible fraudulent activity and offering precautions individuals should take before committing funds.
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