November 4, 2011
CFTC Obtains Orders against Patrick Rakotonanahary and his Company, Cyber Market Group LLC, for Defrauding Customers in a Multi-Million Dollar Foreign Currency Ponzi Scheme
Defendants also misappropriated customer funds in Hawaii and elsewhere in the United States
Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced that the Honorable Susan Oki Mollway of the U.S District Court for the District of Hawaii entered a consent order of permanent injunction against Patrick Rakotonanahary, formerly of Punta Gorda, Fla. Judge Mollway also adopted the Findings and Recommendation for a Default Judgment issued by the Honorable Richard L. Puglisi, U.S. Magistrate Judge for the District of Hawaii, against Rakotonanahary’s company, Cyber Market Group LLC (Cyber).
The CFTC charged Rakotonanahary and Cyber with operating a multi-million dollar foreign currency (forex) Ponzi scheme in Hawaii and elsewhere in the United States and with misappropriating customer funds for their personal use (see CFTC Press Release 5797-10, March 16, 2010).
The consent and default orders require Rakotonanahary and Cyber to each to pay a $500,000 civil monetary penalty and impose permanent trading and registration bans against them. In a related criminal action, Rakotonanahary was ordered to pay $3,473,562.56 in restitution to Cyber victims.
The consent order finds that since June 18, 2008, Rakotonanahary and Cyber solicited funds from clients to trade forex by falsely promising weekly returns from four to 10 percent. The order further finds that these statements were, in fact, false as Rakotonanahary and Cyber knew that they lacked the funds to make such payments and that they used their client’s own funds to make these payments. The order also finds that the defendants provided a letter to Cyber clients that misrepresented the balance of clients’ funds and that Rakotonanahary misappropriated client funds for his personal expenses.
The CFTC thanks the U.S. Attorney’s Office for the District of Hawaii, the Federal Bureau of Investigation, and the Hawaii Department of Commerce and Consumer Affairs for their assistance.
CFTC Division of Enforcement staff members responsible for this case are Elizabeth C. Brennan, Philip D. Rix, Steven Ringer, Lenel Hickson, Stephen J. Obie, and Vincent McGonagle.
Last Updated: November 4, 2011