CFTC Pinches $13 Million Commodity Pool Scam Operator

CFTC Pinches $13 Million Commodity Pool Scam Operator

The United Stated regulator CFTC disclosed late last week that is has charged one David Seibert from Lakeway, Texas, for running a unregistered commodity pool operator. The agency imposed massive sanctions on the firm, approximately $13 million have to be paid out.

The official press release from the CFTC website reveals that Seibert is accused of operating a massive commodity fraud, as well as a soliciting scheme, and was found guilty of misappropriating user funds. He now faces a registration and trading ban imposed by the Court of the Western District of Texas, and is further prohibited from violating the Commodity Exchange Act.

The perpetrator has been order to pay out $10 794 508 in reimbursement to all victimized users, as well as $2 278 853 in civil fines.

While the fraud was running, Seibert proclaimed that all client funds will be used for profitable short – term ‘bridge loans’ to outside borrowers. Seibert would later claim that he sought lending opportunities, and later falsely confirm that the burrowers had been qualified.

However, the perp would never uses the money for the aforementioned loans, but instead would advance the money into his own personal trading account and trade commodity interest with it. It was reported that he lost over $8.3 million. The funds that he did not trade with were used as personal spending money.

The CFTC reported that over $10 million were solicited from 11 participants during the period between March 2016 and April 2019.

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