A federal court in North Carolina has charged Storm Bryant and his son, Elijah Bryant III, along with their companies CapitalStorm, LLC, GenerationBlack, LLC, and NCome, LLC, with running a $1.05 million forex fraud scheme. The Commodity Futures Trading Commission (CFTC) filed the civil enforcement action in the U.S. District Court for the Western District of North Carolina on October 8, 2021.
The Bryants, residents of Los Angeles, California, allegedly solicited approximately 94 clients – who were not considered eligible contract participants – to invest in off-exchange foreign currency trading between March 2018 and the present. The CFTC alleges the father-son duo misappropriated the funds, using $50,870 to pay earlier investors in a Ponzi-like fashion.
The complaint details how the Bryants marketed themselves as highly successful forex traders, promising substantial returns to lure in retail clients through in-person meetings and social media platforms like Facebook and Instagram. Clients were induced to send funds which were then used for personal expenses, including jewelry, luxury rentals, European travel, and to fund the Bryants’ own trading accounts, according to the CFTC.
The defendants failed to register with the CFTC as commodity trading advisors, or as associated persons of a CTA, as required by law. On September 24, 2021, the court issued an *ex parte* order freezing the defendants’ assets and preserving records. A hearing regarding the CFTC’s motion for a preliminary injunction was scheduled for October 8, 2021.
The CFTC is seeking full restitution for defrauded investors, disgorgement of ill-gotten gains, civil monetary penalties, and permanent trading and registration bans against the Bryants and their companies. The agency also requests a permanent injunction to prevent future violations of the Commodity Exchange Act and CFTC Regulations.
The CFTC cautions that restitution orders do not guarantee investors will recover their losses, as the defendants may lack sufficient assets. The agency acknowledged the assistance of the U.S. Attorney’s Office for the Western District of North Carolina and the North Carolina Office of the Secretary of State, Securities Division, in the investigation.
Source: CFTC.gov
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