It was one of my first posts here on Forex Magnates almost two years ago! And now this case is close to completion.
David Smith from notorious Olint (an alleged forex Ponzi Scheme which bilked investors out of hundreds of millions) was linked to I Trade, a former US forex broker. In September 2010 David Smith was extradited to the US and indicted with four counts of wire fraud, one count of conspiracy to commit money laundering and 18 counts of money laundering to conceal specified unlawful activity. The US authorities are also seeking to seize US$128-million which they claim Smith gained through wire fraud.
David Smith was once listed as principal at I-Trade. I Trade was fined $250,000 by the NFA following failure to implement adequate AML procedures (probably related to the Olint case) and then immediately has winded down its business in the US just to reemerge as eforex.com a month later. One may think there might be a relation between the Olint debacle and this sudden business shift. Both I Trade and eforex are run by the Martinez family who are also behind the Market Traders Institute. This very Institute was said to have helped David Smith with his forex ponzi scheme. I-Trade saga was too brought to a closure just recently - Ava FX has acquired all clients of eforex (formerly I-Trade).
And now the final chapter is being written:
David Smith, accused of bilking thousands of investors out of more than $220 million, pleaded guilty to nearly two-dozen charges in Orlando federal court Tuesday. David A. Smith, 41, signed a plea agreement admitting guilt to four counts of wire fraud, a count of conspiracy to commit money laundering, and 18 counts of money laundering. Smith pleaded guilty to fraud and conspiracy charges in the Turks and Caicos Islands last year and was sentenced to just over six years in prison there. U.S. authorities picked Smith up in November and brought him to Orlando to face the federal charges here. Prosecutors say more than 6,000 people from Orange County, Jamaica, the Turks and Caicos Islands and elsewhere invested in Smith's companies, which include the Olint Corp.
I have to say that this story very much reminds of the Trevor Cook/Crown Forex saga, similarities are simply remarkable. One can wonder following David Smith's plea what the implications for the Martinez family may be.
Read the news coverage here and here.
