Dominick Vincent Carducci and his firm, VOS Capital Management, LLC, have been slapped with a hefty judgment for running a fraudulent forex trading scheme, according to a recent court order. The U.S. District Court for the Southern District of New York entered a default judgment on June 23, 2020, finding the pair liable for defrauding investors.
Carducci, of Clemson, South Carolina, and VOS Capital Management are collectively ordered to pay $953,875 in restitution to the victims of their scheme and a civil penalty exceeding $2.86 million. The judgment also permanently bans both Carducci and the company from engaging in any future commodity trading or registration activities, effectively barring them from the industry.
The Commodity Futures Trading Commission (CFTC) originally filed a complaint against Carducci and VOS Capital Management on September 9, 2019, alleging fraud, misappropriation of funds, and failure to properly register with the commission. The court considered the defendants’ lack of response to the complaint as an admission of the allegations.
Investigators determined that, beginning in August 2016, Carducci fraudulently solicited over $1.1 million from at least 30 individuals, promising profits through pooled trading in the retail foreign exchange (forex) market. However, the CFTC found that no actual forex trading occurred. Instead, Carducci allegedly used the majority of the funds to cover personal expenses and maintain a lavish lifestyle.
To lure investors, Carducci and VOS Capital Management falsely claimed a history of successful forex trading, boasting of a $12 million account balance and potential monthly profits of up to 18% with no risk of loss. They also falsely assured investors they could withdraw funds on demand, while in reality, ignoring requests and fabricating excuses for delays. False account statements were issued to conceal the lack of trading activity.
This judgment comes in addition to a criminal sentence Carducci received in a related case in the U.S. District Court for the District of South Carolina. On June 19, 2020, he was sentenced to 24 months in prison and ordered to pay over $950,000 in restitution.
The CFTC cautions that victims may not fully recover their losses, as the defendants may lack sufficient assets. The agency says it will continue to pursue accountability in cases of financial fraud.
Source: CFTC.gov
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