The Commodity Futures Trading Commission (CFTC) has taken legal action against Patrick Wonsey of Riverview, Florida. He has been accused of fraud and misappropriation related to a trading scheme involving leveraged retail foreign currency (forex) and binary options.
Five Years of Fraud: The Timeline of Wonsey's Alleged Activities
The complaint alleges that Wonsey solicited over $3.4 million from at least 50 individuals. It is marked as a significant case in the world of commodity trading and investments. The alleged fraudulent activities spanned approximately from January 2017 through September 2022. Wonsey solicited and pooled funds from investors for purported trading in retail forex, binary options, metals, and digital assets.
The CFTC's complaint, filed in the U.S. District Court for the Middle District of Florida, outlined a series of alleged wrongdoings by Wonsey. The regulatory body is seeking a range of penalties. It includes disgorgement of ill-gotten gains, civil monetary penalties, restitution to victims, permanent registration and trading bans, and a permanent injunction to prevent further violations of the Commodity Exchange Act (CEA).
Alleged Ponzi Scheme: How Wonsey Misused Investor Funds
To entice investors, he is accused of making false claims about his past trading success, the likelihood of future profitability, the frequency of payouts, and the low level of risk associated with his trading operations. However, instead of utilizing the pooled funds for trading as promised, Wonsey allegedly misappropriated the funds for his personal gain. He made payments to other pool participants, resembling a Ponzi scheme.
When investors wanted to withdraw their funds, Wonsey reportedly failed to comply with their requests. He either ignored their pleas, provided misleading excuses, or engaged in actions designed to delay payouts for as long as possible.
The complaint also noted that Wonsey was not registered as a commodity pool operator. He neglected to establish the pool as required by law. He mixed pool participant funds with his own assets and violated regulatory norms.
The CFTC is taking this case seriously, with its Division of Enforcement staff spearheading the effort. This enforcement action reminds of the CFTC's commitment to safeguarding the integrity of financial markets and protecting investors from fraudulent schemes. The agency is actively pursuing justice on behalf of those affected by this alleged misconduct.
