Release Number 8334-20

CFTC Participates in Operation Income Illusion to Raise Retail Fraud Awareness

December 14, 2020

— The Commodity Futures Trading Commission today announced its participation in “Operation Income Illusion.” Spearheaded by the Federal Trade Commission, Operation Income Illusion is a joint effort announcing law enforcement cases and customer education information as part of a nationwide crackdown on scams targeting customers with fake promises of income.

The Operation Income Illusion initiative encompasses cases from 20 federal, state, and local agencies, including 32 actions from the CFTC’s Division of Enforcement. The CFTC’s participation in the initiative underscores the Commission’s commitment to protecting customers in derivatives markets.

“The CFTC’s enforcement efforts in connection with Operation Income Illusion demonstrate that the CFTC continues to bring critical, high impact cases that protect customers. We can most effectively protect customers by working together with our colleagues in the enforcement and regulatory community,” said Division of Enforcement Acting Director Vince McGonagle. “Partnership with our counterparts is an indispensable element of our enforcement program.”

In addition to the CFTC’s Operation Income Illusion enforcement cases, it is raising awareness about the potential for fraud through its social media accounts. In recent months, the CFTC has received hundreds of tips about individuals posing as digital asset or foreign exchange brokers promising to multiply investments tens or hundreds of times in a matter of weeks. The promises, most often times made by unregistered entities, are used to get traders to invest and pay one fee after another in order to claim their profits. These frauds generally originate on social media platforms and utilize other technologies, such as encrypted messaging apps, that further hide the fraudsters’ true identities. The CFTC posts highlight recent fraud trends and provide tips to help social media users spot and avoid potential scams.

“All of the CFTC cases included in Operation Income Illusion have one thing in common,” said Director of the Market Participants Division Joshua B. Sterling, whose unit oversees the CFTC’s customer education initiatives. “None of the entities or perpetrators that committed these frauds were registered with the CFTC. Registration is not a guarantee of fraud-free trading, but it does provide certain safeguards that can weed out bad actors and ensures customers receive all the protections afforded to them under the law. All market participants, whether they are seasoned hedgers or freshly minted speculators, should check the registration status of the people and companies they give their money to before trading.”

CFTC’s Customer Protection Information

The CFTC has issued advisories, videos, and publications to alert customers about fraud and easy ways to spot them.

Customers can report suspicious activities or information, such as possible violations of commodity trading laws, to the Division of Enforcement via a toll-free hotline 866-FON-CFTC (866-366-2382) or file a tip or complaint online.