The former resident of Florida and his Wyoming-based firm have to jointly pay more than $5.9 million in restitution and over $5.9 million as civil penalties for running a fraudulent forex scheme. Last week, the judgment came with the actions of the Commodity Futures Trading Commission (CFTC) against the fraudsters.

Another FX Pool Trading Fraud

According to the official announcement, Darren Robinson operated The QYU Holdings (QYUHI) as a commodity pool operator from around 1 January 2017 to 28 September 2023 but did not register the company with the CFTC, which is mandatory. Robinson was also not registered with the regulator.

“QYUHI failed to comply with CPO regulations,” the CFTC noted in its announcement last Friday, adding that the court order “resolves the CFTC’s enforcement action Robinson and QYUHI.”

Robinson is also facing 11 counts of wire fraud and one count of money laundering and is currently a fugitive.

Over Three Dozen Victims

The regulator highlighted that Robinson and QYUHI engaged in a multimillion-dollar fraudulent scheme and accepted about $7.2 million from 38 people to participate in a commodity pool operated by the company. The scheme promised to trade commodity interests, including forex pairs, on a leveraged, margined, or financed basis with participants who were not eligible contract participants (retail forex) and forex futures contracts.

In reality, the funds were misappropriated and directly deposited into QYUHI’s corporate bank account, which Robinson controlled.

The CFTC pointed out that Robinson used the funds from the pool participants for personal expenses, “including, but not limited to, luxury cruises, airfare, luxury vehicle purchases, real property purchases, credit cards payments, and other daily living expenses.” He even used at least $1.27 million of the funds to pay earlier-in-time participants purported “profits” and/or “redemptions” similar to a Ponzi scheme.

“The CFTC cautions that orders requiring repayment of funds to victims may not result in the recovery of any money lost because the wrongdoers may not have sufficient funds or assets,” the regulator added. “The CFTC will continue to fight vigorously for the protection of customers and to ensure the wrongdoers are held accountable.”