Stuart, FL – Frank Anthony DeSantis III and Doreen Rose Valko were ordered to pay over $8 million in restitution and penalties for defrauding investors through a foreign currency (forex) options scheme, the U.S. Commodity Futures Trading Commission (CFTC) announced on September 16, 2008. The case originated in the Southern District of Florida.
U.S. District Court Judge William P. Dimitrouleas mandated that DeSantis III and Valko jointly pay $4 million in restitution to approximately 205 defrauded investors. DeSantis III was also ordered to pay a $4 million civil monetary penalty, while Valko’s penalty was set at $360,000. Both individuals were permanently barred from participating in any business involving commodity futures and options trading.
The court previously determined that Thomas W. Yoos, Jr. and American Lighthouse Trading, Inc. (ALT) had received funds obtained fraudulently from the scheme. As a result, ALT was ordered to disgorge $6,795 in ill-gotten gains, and Yoos was ordered to disgorge $15,100.
The CFTC initially filed anti-fraud charges in July 2006 against Valko and DeSantis III, alleging that International Investments Holdings Corporation (IIHC), falsely presented as a Bahamian corporation but operating from South Florida, misappropriated at least $1.13 million from retail customers while claiming to trade forex options. DeSantis III was charged with knowingly assisting in the creation and operation of IIHC by providing consulting and marketing services to Valko and the company. The CFTC also alleged that falsified customer account statements were generated to conceal the misappropriation of funds.
The case was led by CFTC Division of Enforcement staff members Timothy J. Mulreany, David Reed, Michael Amakor, Paul Hayeck, and Joan Manley.
Source: CFTC.gov
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