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Entries in currency (3)

Thursday
Jun302011

CFTC Charges Colorado Man With $1.9 Million Ponzi Scheme

Charges were unsealed Thursday by the United States Commodity Futures Trading Commission against a Colorado man and his company. The CFTC alleged that Shawon McClung, of Denver, Colorado, operated Flint-McClung Capital LLC of Englewood, Colorado and promised investors lucrative returns from a foreign currency-trading business, but instead operated as a classic Ponzi Scheme that did not do any currency trading.
The District Court Judge handling the case, Judge Christine M. Arguello, has issued emergency orders freezing the assets of the accused during the pendency of an investigation.

Tuesday
Jun282011

Colorado Man Pleads Guilty to $1.7 Million Ponzi Scheme

A Colorado man has pled guilty to defrauding at least 79 investors as part of a Ponzi scheme that netted at least $1.7 million.  Frederick H.K. Baker, 46, pled guilty Tuesday to one count of wire fraud and one count of conspiracy to commit wire fraud in connection with a purported sophisticated currency trading operation that was ultimately revealed to be a Ponzi scheme.

Baker admitted that he began soliciting investors in 2006 and 2007 from Colorado and several other states.  Promising investors a monthly return of at least 8 percent, Baker also guaranteed investors that the principal would remain safe.  Yet, instead of using actual profits, Baker used funds from incoming investors to pay older investors.  Prosecutors alleged that investor funds were used to pay for off-road vehicles, a down payment on a Durango, CO house, and work done on personal automobiles.  

As part of Baker's sentence, he was also ordered to pay $820,000 in restitution to the victims defrauded by the scheme.  He is currently scheduled to be sentenced on October 7th in a Denver federal court. Under current federal sentencing guidelines, Baker faces a sentence between 41 and 51 months in prison.  Another individual charged in the scheme, Mark Akins, is still awaiting trial after pleading not guilty earlier this year.  

Friday
Jun242011

Authorities Charge Miami Man With $768k Ponzi Scheme

A South Florida man and his company have been accused of swindling $768 thousand from investors as part of a Ponzi Scheme.  Juvenal Eduardo Machado, along with Invers Forex, was charged by the U.S. Commodities Futures Trading Commission ("CFTC") of defrauding at least 28 investors by operating a Ponzi Scheme under the guise of a foreign currency trading operation.

In return for opening an account with Machado, investors were promised monthly returns exceeding five percent.  Instead, Machado used a majority of the funds for personal and business expenses, including the payment of false interest payments to investors.  The complaint filed by the CFTC alleges that only $135,000 was invested in currency trading, and nearly all of the $135,000 was lost.  

Many of the investors were said to have attended prayer services at Machado's home.