Middleton, Massachusetts resident Curtis Dalton has been ordered to pay $200,000 to settle charges brought by the U.S. Commodity Futures Trading Commission (CFTC) for illegally offering off-exchange retail commodity transactions. The CFTC announced the settlement on July 29, 2019.
The charges stem from Dalton’s practice of selling binary options in foreign currencies to customers in the U.S. and internationally without being registered with the CFTC as a futures commission merchant. These binary options, which are a form of speculative contract, were traded on a platform operated by an unregistered company based in the British Virgin Islands and located in Cyprus – bypassing established and regulated trading venues.
According to the CFTC, legally compliant transactions of this nature must occur on designated contract markets, exempt boards of trade, or bona fide foreign boards of trade. Dalton’s operation circumvented these requirements, effectively operating as an illegal, unregistered intermediary.
“The requirement that these contracts be offered by registered entities on a bona fide exchange is part of the CFTC’s comprehensive regulatory regime to protect the public from unscrupulous trading outfits,” stated James McDonald, Director of Enforcement at the CFTC. He urged customers to thoroughly vet any firm they consider using for commodity trading.
In addition to the $200,000 civil monetary penalty, the CFTC order permanently prohibits Dalton from engaging in future trading activities for others or soliciting funds for the purpose of trading commodity interests. This effectively bars him from participating in the commodity markets in any capacity involving other people’s money.
The case was led by CFTC staff members Alan Edelman, Diana Dietrich, Daniel Jordan, Michael Loconte, and Rick Glaser.
Source: CFTC.gov
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