Direct Investment Products principal allegedly misappropriating almost half a million US dollars
The US CFTC has charged California based Direct Investment Products Inc. and its principal Alexander Glytenko for alleged solicitation of about 761 individuals residing in Russian and former Soviet republics to invest a total of almost $ 4 million into the commodity pool known as DIP Capital Partners from which about half a million dollars were misappropriated.
According to the regulator from 2005 until 2010 the firm engaged in a misrepresentation practice of the pool’s performance to gain new investors and to reassure existing ones. The CFTC states that the firm’s solicitation practices presented only hypothetical performance without informing potential investors about that and to conclude the allegations the firm presented historical data for at least two years of returns when in fact the commodity pool experienced losses.
According to the press release the Defendants falsely claimed that the pool made annual profits between 2003 and 2008 in a range from 12.6% to 47.2% to lure in potential investors. According to data presented in the claim the pool didn’t even exist until 2005 and certified financial statements of one of the pool’s funds showed actual losses for 2007 and 2008.
In 2009 Direct Investment Products Inc has imposed a freeze on withdrawals of participants’ funds and Mr Lysenko has signed off a loan to himself from the company’s assets totaling $464,000. According to the complaint the loan has never been repaid.
On the LinkedIn profile of Alexander Lysenko we have found out that he claims that since 2010 he is employed by another California based fund named Advanced Asset Management Inc (not to be confused with Advanced Asset Management LLC which is based in Michigan). We were unable to find any details nor a website of the fund in question.
For further information visit CFTC’s website for the full press release.