ATLANTA, GA – Saxon Financial Services Inc. has been ordered to pay over $4.3 million in penalties and restitution for commodity option fraud, the U.S. Commodity Futures Trading Commission (CFTC) announced today, August 26, 2009.
Judge Julie E. Carnes of the U.S. District Court for the Northern District of Georgia entered a final judgment against Saxon, requiring a civil monetary penalty of $3,289,434 and disgorgement totaling $1,096,478, in addition to post-judgment interest. The order also permanently prohibits Saxon from engaging in any further commodity-related trading.
The CFTC initially filed a complaint against Saxon on October 3, 2007, alleging fraudulent practices related to off-exchange options contracts for unleaded gas, heating oil, and foreign currencies. The complaint detailed how Saxon utilized aggressive telemarketing techniques to target customers in Canada and various European countries.
According to the CFTC, Saxon falsely promised customers substantial profits through a “could not lose” trading strategy based on the firm’s recommendations. However, the agency alleges that customers ultimately lost nearly all of their invested funds while trading through Saxon.
The CFTC acknowledged the assistance of several international and domestic agencies in the investigation, including the Alberta Securities Commission, Quebec’s Autorite des Marches Financiers, the New Brunswick Securities Commission, the Saskatchewan Financial Services Commission, BaFin, the U.S. Attorney’s Office for the Northern District of Georgia, and the U.S. Marshals Service.
The case was led by CFTC Division of Enforcement staff members Ken Koh, Todd Kelly, Peter Haas, Paul Hayeck, and Joan Manley.
Source: CFTC.gov
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