Two air traffic controllers and a commodity trader set up and execute a nice little forex fraud.
The CFTC announced more than two years ago in June 2011 that it is filing charges against Louis J. Giddens, Anthony W. Dutton and Michael Gomez for setting up and executing a forex trading scheme. They have accepted from friends and co-workers more than $1.4 mln starting their activities in 2010 through commodity pools Currency Management Group and Pinnacle Capital Partners.
Once in these companies, the funds were finding their way either to forex trading accounts or to Mr. Gomez’s or Dutton’s pockets. The pool participants were fed promises of some quite substantial returns – between 5% and 10% a month. The group has forged false account statements for the trading period when in reality the gains in the managed accounts were non-existent.
The “traders” also issued promissory notes that were aimed at reassuring investors that they are going to get their principal investment back plus the already mentioned monthly 5 to 10%. The issued notes did not have any mention of risks associated with forex trading.
We all know that the markets can be a source of substantial income, but traders and investors should always be aware of the undertaking of risk of losing the principal investment. So far history has shown that promises of consistent monthly or yearly returns is much more likely than not associated with a Ponzi scheme, with Mr. Madoff probably being the most popular actor in these series.
To see the CFTC press release click here.