The Commodity Futures Trading Commission (CFTC) has filed a civil enforcement action against ten defendants accused of operating a $4.75 million Ponzi scheme involving off-exchange foreign currency (forex) trading. The case, filed in the United States District Court for the Middle District of Florida, centers around a multi-level scheme that allegedly defrauded over 150 victims.
Avinash Singh, a Florida resident, is the primary defendant, accused of fraudulently soliciting and misappropriating funds through his commodity pool, Highrise Advantage, LLC. Also charged are Daniel Cologero and Randy Rosseau, both of Florida, and Hemraj Singh of New Jersey, who allegedly solicited funds for Highrise through their own commodity pools: Green Knight Investments, LLC, Bull Run Advantage, LLC, and King Royalty, LLC. Surujpaul Sahdeo, a Florida resident, and his company, SR&B Enterprises, are accused of unlawfully soliciting funds and transferring them to Highrise.
U.S. District Court Judge Carlos E. Mondoza issued a statutory restraining order on September 16, 2020, freezing the assets of Singh, Highrise, Green Knight, Bull Run, King Royalty, and SR&B. The order also prevents the defendants from destroying or concealing their financial records.
According to the CFTC complaint, the scheme operated from approximately February 2013 until recently. Avinash Singh allegedly falsely claimed to be a successful commodities trader with a history of profits, attracting investors to Highrise. Cologero, Hemraj Singh, and Rosseau are accused of further misrepresenting Highrise’s profitability and downplaying the risks involved.
The CFTC alleges that of the $4.75 million collected from investors, only $1,656,000 was actually used for forex trading. At least $3 million of the funds were allegedly misappropriated by Avinash Singh and Highrise to cover personal expenses, transfer money to other defendants, and make Ponzi-style payments to earlier investors. The defendants allegedly issued falsified monthly account statements to investors, inflating profits and balances.
SR&B Enterprises reportedly received $1,350,000 from victims and subsequently transferred the funds to Highrise to fuel the forex trading account. All defendants are also charged with failing to register with the CFTC as required and violating other regulatory requirements for operating commodity pools.
The CFTC is seeking full restitution for defrauded victims, disgorgement of any ill-gotten gains, civil monetary penalties, a permanent injunction against future violations of the Commodity Exchange Act, and permanent registration and trading bans. The agency acknowledged the assistance of the United Kingdom Financial Conduct Authority and the Australian Securities and Investments Commission in the investigation.
Source: CFTC.gov
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