Miami resident Daniel Fingerhut and three Israeli nationals, along with their company Digital Platinum Limited (DPL), have been ordered to pay $7 million in penalties for defrauding customers through off-exchange binary options and digital asset trading, the Commodity Futures Trading Commission (CFTC) announced Thursday.
U.S. District Judge Darrin P. Gayles of the Southern District of Florida issued permanent injunctions against Fingerhut, Itay Barak, Tal Valariola, and DPL. The orders also include permanent trading and registration bans for Fingerhut, Barak, and Valariola.
The CFTC initially filed a complaint in May 2020, alleging that the defendants fraudulently solicited tens of millions of dollars from customers to fund accounts trading foreign exchange, metals, and digital assets through unregistered brokers. The scheme involved misleading marketing materials, including fabricated trading results and customer testimonials, promising access to successful automated trading systems.
Specifically, the court found that Fingerhut, Barak, and Valariola created and disseminated these fraudulent solicitations via email, websites, and video sales letters. Fingerhut was also found to have knowingly made false statements to the CFTC during the investigation.
Fingerhut is personally liable for $400,011 in disgorgement and a $600,000 civil monetary penalty. Barak, Valariola, and DPL are collectively responsible for $3 million in disgorgement and a $3 million civil monetary penalty.
The CFTC noted that restitution orders do not guarantee victims will recover their losses, as wrongdoers may lack sufficient assets. The agency continues to pursue litigation against two additional entity defendants and one relief defendant in this case. The CFTC collaborated with the Israel Securities Authority and the Financial Supervision Commission of Bulgaria during the investigation.
Customers are urged to verify a company’s registration with the CFTC before investing and to report suspicious activity via the toll-free hotline 866-FON-CFTC or online.
Source: CFTC.gov
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