SACRAMENTO, CA – The Commodity Futures Trading Commission (CFTC) has filed a civil enforcement action in the Eastern District of California against John D. Black and his associates, alleging a $14.5 million Ponzi scheme involving binary options and retail foreign currency (forex) investments. The complaint also names Christopher Mancuso, Joseph Tufo, John P. Glenn, and Glenn’s law firm, The Law Firm of John Glenn, P.C., as defendants.
According to the CFTC, Black, operating through entities Financial Tree (d/b/a Financial Tree Trust), Financial Solution Group (d/b/a Financial Solution Group Trust), and New Money Advisors, LLC, misappropriated over $11 million. These funds were used to pay earlier investors – a hallmark of Ponzi schemes – and for personal expenses including travel, home renovations, luxury services, gambling, and divorce-related costs. The scheme allegedly defrauded at least 91 individuals, over 50 of whom reside in the United States.
On July 2, 2020, Judge Troy L. Nunley of the U.S. District Court for the Eastern District of California issued a restraining order, freezing the assets of the defendants and seven identified relief defendants. The order also allows the CFTC to inspect relevant records.
The CFTC alleges the fraudulent solicitations occurred from June 15, 2015, through the present. Defendants are accused of issuing false account statements and offering increasingly implausible excuses to investors for delayed returns and unfulfilled profit promises, citing reasons such as European vacations and storms in the Bahamas.
The agency is seeking disgorgement of ill-gotten gains, civil monetary penalties, restitution for victims, permanent registration and trading bans, and a permanent injunction against further violations of the Commodity Exchange Act and CFTC regulations. The CFTC stated this action demonstrates its commitment to aggressively pursue fraud in the financial markets, even during challenging circumstances.
The California Department of Business Oversight provided cooperation and assistance in the investigation. The case is ongoing.
Source: CFTC.gov
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