September 29, 2015
CFTC Orders Florida Resident Barbara Cohen and Her Company, Pure Reason, LLC, to Pay a $140,000 Penalty for Cohen’s False Statements to the CFTC and for Not Disclosing that Profitable Trading Results Were Based on Hypothetical Trading
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today issued an Order filing and settling charges that Barbara Cohen of Tarpon Springs, Florida, made false statements of material fact to CFTC staff and that the website of Cohen’s company, Pure Reason, LLC (Pure Reason), promoted Pure Reason’s trading software by demonstrating profitable trading results without disclosing that these results were based on hypothetical, and not actual, trading. The CFTC Order requires Cohen and Pure Reason jointly to pay a $140,000 civil monetary penalty.
The Order finds that on October 22, 2014, Cohen knowingly made false and misleading statements to CFTC staff while testifying under oath. The Order finds that Cohen falsely testified that she was authorized to trade and traded an account that she never in fact traded or had any authority to trade. Such conduct violated the Commodity Exchange Act (CEA), which prohibits the making of a false or misleading statement to the CFTC.
The Order also finds that from March 2012 to January 2013, Pure Reason, a registered Commodity Trading Advisor, promoted on its website and in webinars profitable trading results from its software trading program. These profitable trading results, the Order finds, were based on hypothetical trades and there was no disclosure on the website or during the webinars that these were not actual trading results. The Order further finds that Cohen, a registered Associated Person of Pure Reason, was a principal, part owner, officer, and thus controlling person of Pure Reason and that she knowingly induced and is liable for Pure Reason’s non-disclosures.
In addition to the $140,000 civil monetary penalty, the CFTC Order requires Cohen and Pure Reason to cease and desist from violating the provisions of the CEA and CFTC Regulations, as charged, and requires Cohen for one year not to apply for or claim exemption from registration with the CFTC or engage in any activity requiring such registration or exemption.
CFTC Division of Enforcement staff members responsible for this action are Mark Picard, Judith M. Slowly, Elizabeth C. Brennan, Steven Ringer, Lenel Hickson, Jr. and Manal M. Sultan.
Last Updated: September 29, 2015