Just days after announcing that Forex scams were no less than 25% of all its cases CFTC announces that it halted another Forex Ponzi Scheme :
CFTC Charges Ohioans Kevin and Keelan Harris, Complete Developments LLC, Investment International Inc. and Three Ontario, Canada-based Defendants with Operating a Multi-Million Dollar Foreign Currency Ponzi Scheme
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced the filing of a lawsuit against brothers Kevin and Keelan Harris and their companies, Complete Developments LLC (CDL) and Investment International Inc. (I3), all of Warren, Ohio, Karen Starr of Barrie, Ontario, and Patrick Cole and Global Strategic Marketing Inc. (GSM), both of Mississauga, Ontario. The CFTC’s civil complaint, filed on October 7, 2010, in the U.S. District Court for the Northern District of Ohio, charges the defendants with fraud and misappropriation in connection with the operation of a multi-million dollar foreign currency (forex) Ponzi scheme.
The complaint alleges that, from about November 2006 until October 2008, CDL and I3 fraudulently solicited and accepted millions of dollars from hundreds of individuals to open “professionally managed” accounts for the purported purpose of trading off-exchange forex contracts. However, rather than trading forex on their customers’ behalf, CDL and I3 allegedly operated as a Ponzi scheme, using new customers’ money to pay purported interest to existing customers, and misappropriated customer funds, the complaint charges.
Specifically, according to the complaint, CDL, I3, CDL’s president and CEO Kevin Harris, I3 Director Starr and GSM, CDL’s exclusive marketing agent, allegedly made false representations in soliciting customers, including that 1) they would trade forex on customers’ behalf, 2) customers would receive guaranteed monthly interest of between 5 percent and 12 percent on their investments, 3) at least 80 percent of the funds invested would be returned to customers and 4) customer funds would be segregated from CDL and I3’s corporate funds. The complaint also charges that the same defendants concealed from customers that defendants Kevin and Keelan Harris and Starr had been previously convicted of multiple offenses, including fraud. GSM’s President Cole, as a controlling person of GSM, is liable for knowingly inducing GSM’s violations, according to the compliant.
The complaint also charges CDL, I3 and Kevin and Keelan Harris with misappropriation by transferring customer funds to Kevin Harris’ and Starr’s joint personal trading account and using customer funds to pay personal expenses, including mortgages, car leases, cell phone bills, airline tickets, hotel rooms and rental cars.
The rest here.
