Travis Capson of Kanab, Utah, along with Arnab Sarkar of El Cerrito, California, and their company Denari Capital, LLC, have been penalized by the U.S. District Court for the Northern District of California for running a fraudulent foreign exchange (forex) pool. The Commodity Futures Trading Commission (CFTC) originally filed a complaint against the defendants on November 5, 2019, leading to a consent order issued on November 29, 2021.
The court found Capson, Sarkar, and Denari Capital liable for forex pool fraud and for failing to register with the CFTC as required. Capson was also found liable for misrepresentations made to the National Futures Association (NFA).
As a result of the order, Capson will pay a $250,000 civil monetary penalty, while Sarkar will pay $166,000. All three defendants, along with Denari Capital, are jointly required to pay $3,663,282 in restitution to the victims of the scheme. A permanent injunction has been imposed, barring further violations of the Commodity Exchange Act and CFTC regulations. They are also permanently banned from registering with the CFTC and are prohibited from trading for five years.
The investigation revealed that from at least August 2012 through December 2019, the defendants falsely advertised Denari’s past forex trading profitability to attract investors. They issued fabricated account statements, failed to maintain proper fund segregation, improperly commingled pool funds, and neglected to provide required disclosures to investors. Capson further misled NFA representatives during a July 15, 2019 examination, falsely claiming Denari had only traded with proprietary funds since 2015 and did not trade for third parties until 2019.
Kathy Bazoian Phelps has been appointed as the Permanent Receiver for Denari Capital, and has already recovered and distributed over $700,000 in funds and more than $2.5 million in securities to satisfy participant claims. However, the CFTC cautions that restitution orders do not guarantee full recovery of lost funds.
The CFTC thanked the NFA for its assistance in the investigation. The case was led by Carlin Metzger, Joy McCormack, Matthew Edelstein, Joseph Konizeski, Scott Williamson, and Robert Howell of the Division of Enforcement.
The CFTC advises potential investors to be wary of fraud, particularly in the forex market, and provides resources for reporting suspicious activity via a toll-free hotline (866-FON-CFTC) or online complaint form.
Source: CFTC.gov
Related Federal Cases
- Peter C. Chang, Insider Trading Scheme, California 2024 · California
- Cook, Mortgage Fraud Scheme, Utah 2023 · Pennsylvania
- Eight Charged in $273K Scheme to Scam 80-Year-Old Widow, Utah 2023 · Washington
- Keith Nelson Cook, Mortgage Fraud Scheme, Salt Lake City UT, 2023 · Michigan
- Dorothy Matsuba Led $30M Mortgage Relief Fraud Scheme, Los Angeles … · Utah
MORE FEDERAL CRIME NEWS
US NewsUS NewsUS NewsUS News