SACRAMENTO, CA – A federal court has entered a default judgment against John D. Black and six associates for a multi-million dollar fraud scheme involving binary options and retail foreign currency (forex) transactions. The Commodity Futures Trading Commission (CFTC) brought the enforcement action, alleging solicitation fraud, commodity pool operator (CPO) fraud, registration violations, and regulatory non-compliance.
The U.S. District Court for the Eastern District of California found Black, along with his affiliated entities – Financial Tree (d/b/a Financial Tree Trust), Financial Solution Group (d/b/a Financial Solution Group Trust), and New Money Advisors, LLC – liable for the fraudulent activities. Also named in the judgment are Christopher Mancuso, Joseph Tufo, John P. Glenn, and Glenn’s law firm, The Law Firm of John Glenn, P.C.
According to court documents, from June 2015 to June 2020, the defendants fraudulently solicited funds from the public for investment in the fraudulent commodity pools. The CFTC alleges the defendants misappropriated millions for personal use, operated a Ponzi scheme by using new investor funds to pay existing investors, and made false statements to conceal their failure to deliver promised returns.
The court ordered the defendants to collectively pay nearly $10.5 million in restitution. Tufo was assigned over $4.5 million of the restitution liability. Civil monetary penalties were also levied: $5.4 million against Black, Financial Tree, Financial Solution, and New Money; $12.1 million against Mancuso; $680,000 against Tufo; and $850,000 against Glenn and his law firm. The defendants are permanently barred from engaging in any activities that violate the Commodity Exchange Act, registering with the CFTC, and trading on regulated markets.
Additionally, seven relief defendants are required to disgorge over $2.6 million in fraudulently obtained funds. The case was originally filed on June 15, 2020, and moved forward after the defendants failed to respond. The CFTC urges investors to verify the registration of companies and individuals before investing, and provides resources on its website detailing the warning signs of commodity pool, binary options, and forex fraud.
The CFTC enforcement team included Anthony Biagioli, Elsie Robinson, Jeff Le Riche, Christopher Reed, Charles Marvine, and former staff member Jo Mettenburg.
Source: CFTC.gov
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