For Release: January 23, 2008
CFTC Files Action to Revoke Registrations of Introducing Brokers Liberty Financial Trading Corp., Inc. and Liberty Real Assets Investment Corporation
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) is moving to revoke the registrations of Liberty Financial Trading Corp., Inc. (LFTC) and Liberty Real Assets Investment Corporation (LRAIC), both of Pompano Beach, Florida, as Introducing Brokers (IBs). The action is based, in part, on fraud judgments entered against them.
The CFTC filed a Notice of Intent to Revoke Registration (Notice) on January 23, 2008, alleging that LFTC and LRAIC are subject to statutory disqualification of their registrations as IBs based on a consent order of permanent injunction order against them in the U.S. District Court for the Southern District of Florida on April 24, 2007. (See CFTC Press Release 5333-07, May 7, 2007.)
The consent order found that LFTC (from at least early 2002) and LRAIC (from about June 2004), operating as a common enterprise, fraudulently solicited at least 930 retail customers to trade commodity options contracts, resulting in losses of at least $10 million. The order also found that LFTC and LRAIC misrepresented the profit potential and risk involved in trading commodity options contracts; failed to disclose their performance record; and misrepresented the actual performance of customers’ accounts.
To settle the action, LFTC and LRAIC were ordered to pay a total of $6.5 million in civil monetary penalties and restitution totaling $9.783 million and were prohibited from registering with the CFTC in any capacity.
The following CFTC Division of Enforcement staff were responsible for this action: Alan Edelman, James H. Holl III, Gretchen L. Lowe, and Vincent A. McGonagle.
Last Updated: January 23, 2008