The Commodity Futures Trading Commission (CFTC) has start legal action against the California based Denari Capital, LLC, along with its owners Travis Capson and Arnab Sarkar for allegedly committing a 8.3 million USD foreign exchange fraud, soliciting funds from at least 28 victims.
According to the complaint filed with the U.S. District Court for the Northern District of California the scheme was run since at least 2012 and the funds were collected through a pooled investment scheme.
CFTC notes that Capson and Sarkar “fraudulently solicited participants and prospective participants by willfully or recklessly making material misrepresentations concerning the past profitability of Denari’s forex trading and the profits its participants were making. The defendants also allegedly issued false account statements to participants that misrepresented the profitability of their respective interests in the pool.”
Both Capson and Sarkar were required to register with the CFTC from the beginning of their operations. Capson is also accused of falsely reporting to the National Future Association (NFA) that they traded only with proprietary funds, while in reality they traded with their clients money.