April 6, 2017
Federal Court Orders Relief Defendants Westward International Ltd. and Coucarin Holdings Ltd. to Disgorge Ill-Gotten Funds Totaling More than $1.77 Million in CFTC Binary Options Fraud Action
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced that Judge James I. Cohn of the U.S. District Court for the Southern District of Florida entered final default judgments against Relief Defendants Westward International Ltd. (Westward) and Coucarin Holdings Ltd. (Coucarin), both of Deerfield Beach, Florida. The Default Judgment Orders, both entered on March 23, 2017, require Westward and Coucarin to disgorge ill-gotten client funds in the amounts of $211,160 and $1,565,480, respectively.
Both Default Judgment Orders arise from a CFTC enforcement anti-fraud action filed against Defendants Neil Pecker and Vision Financial Partners, LLC and Relief Defendants Prometheus Enterprises, Inc., GDCM Trust, Westward, and Coucarin on February 16, 2016 (see CFTC Complaint and Press Release 7334-16).
On March 9, 2017, the court entered a Consent Order of Permanent Injunction against Neil Pecker and Vision Financial Partners, LLC and Relief Defendants Prometheus Enterprises, Inc., and GDCM Trust (see CFTC Press Release and Order 7536-17).
The Court’s Findings
The Default Judgment Orders find that Pecker and Vision fraudulently solicited approximately $3 million from over 120 members of the public in the U.S. and Canada to trade off-exchange binary options. The Default Judgment Orders also find that, rather than trade binary options on behalf of their clients, the Defendants misappropriated almost $2 million of client funds, and diverted those client funds to Relief Defendants, including Westward and Coucarin. The court also found that Westward and Coucarin did not provide any legitimate services nor had any legitimate entitlement or interest to the client funds, and must disgorge those funds.
The CFTC cautions that orders requiring repayment of funds to victims may not result in the recovery of any money lost because the wrongdoers many not have sufficient funds or assets. The CFTC will continue to fight vigorously for the protection of customers and to ensure the wrongdoers are held accountable.
The CFTC thanks the U.K. Financial Conduct Authority, Cyprus Securities and Exchange Commission, St. Vincent and the Grenadines Financial Services Authority, Ontario Securities Commission, New Brunswick Financial and Consumer Services Commission (formerly New Brunswick Securities Commission), Cayman Islands Monetary Authority, British Columbia Securities Commission, Alberta Securities Commission, Anguilla Financial Services Commission, Gibraltar Financial Services Commission, and the British Virgin Islands Financial Services Commission for their assistance in this matter.
CFTC Division Enforcement staff members responsible for this case are Eugenia Vroustouris, Michelle Bougas, Erica Bodin, Elizabeth C. Padgett, Mary Q. Lutz, Elizabeth Davis, and Rick Glaser.
* * * * * * *
See CFTC’s Binary Options Customer Fraud Advisory and “RED” List
The CFTC has issued a Consumer Alert to warn about fraudulent schemes involving binary options and their trading platforms. The Alert warns customers that the perpetrators of these unlawful schemes allegedly refuse to credit customer accounts, deny fund reimbursement, commit identity theft, and manipulate software to generate losing trades.
Also, see 1) CFTC Press Release 7224-15, September 9, 2015: CFTC Publishes List of Foreign Entities that Illegally Solicit U.S. Residents to Trade Foreign Currency and Binary Options; The New Registration Deficient ‘RED List’ Identifies Companies Operating Illegally and 2) CFTC Press Release 7363-16, April 18, 2016: CFTC Announces Additional Names to Its List of Foreign Entities that Illegally Solicit U.S. Residents in Forex and Binary Options.
Customers can report suspicious activities or information, such as possible violations of commodity trading laws, to the CFTC Division of Enforcement via a Toll-Free Hotline 866-FON-CFTC (866-366-2382) or file a tip or complaint online.
Last Updated: April 6, 2017