Another Binary Options bites the dust: Aaron Butler’s NCI to pay $1.1 million for fraud

Rick Steves

Mr. Butler told customers his firm would pool customer deposits into a single trading account at Nadex and trade on the customers’ behalf. Instead, he spent tens of thousands of dollars on jewelry, purchases at Apple stores, and Toys “R” Us gift cards.

The Commodity Futures Trading Commission today announced that Judge Liles C. Burke of the U.S. District Court for the Northern District of Alabama entered a default judgment against

Negus Capital Incorporated (NCI), through its owner Aaron B. Butler, was found guilty of fraudulent solicitation, misappropriation, and registration violations in connection with binary options trading.

Judge Liles C. Burke of the U.S. District Court for the Northern District of Alabama has ordered NCI to pay $294,545 in restitution to defrauded customers and a civil monetary penalty of $883,635.

A 2019 enforcement action by the CFTC had charged Mr. Butler and NCI and the court had previously granted a permanent injunction against Mr. Butler and requiring him to pay a combined $755,000 in restitution and civil monetary penalty.

The CFTC found that from March 16, 2017, through February 21, 2018, The binary options firm unlawfully solicited and accepted $294,545 from 70 members of the public to trade binary options contracts on the North American Derivatives Exchange (Nadex), defrauded those customers, and operated as an unregistered commodity pool operator.

According to the regulator and the court, Mr. Butler told customers his firm would pool customer deposits between $500 and $5,000 into a single trading account at Nadex and would use those funds to trade binary options on the customers’ behalf.

Instead, the defendant misappropriated most, if not all of the funds for Mr. Butler’s personal benefit, including spending tens of thousands of dollars on jewelry, purchases at Apple stores, and Toys “R” Us gift cards.

In another case brought forth by the CFTC, the regulator settled charges with Glenn Olson for his role in a binary options fraud, requiring Mr. Olson to disgorge all of his ill-gotten gains, totaling $241,070.

According to the order, at least 27 customers lost a total of $846,405 as a result of the fraudulent scheme. Mr. Olson and other defendants were ordered to pay that sum in restitution, but victims were cautioned that they might never recover the money lost because wrongdoers may not have sufficient funds or assets.

The binary options fraud was operated by Blue Bit using alias names between 2014 and 2018. The firm would misrepresent the profitability of trading, manipulate or fabricate purported trades in their customers’ accounts to the customers’ disadvantage, prevent customers from withdrawing funds, and misappropriate customer funds.

While ASIC, Australia’s financial watchdog, has recently decided to ban binary options trading offerings to retail customers, courts across the world are still filled with cases of fraud involving binary options.

Read this next

Retail FX

Plus500 sees modest growth in Q1 revenues, EBITDA margin decreases

Israeli-based, but London-stock market listed Plus500 Ltd (LON:PLUS) today reported a 4% increase in revenue for the first quarter of 2024, with figures rising from $207.9 million in Q1 2023 to $215.6 million.

Technical Analysis

FTSE 100 Technical Analysis Report 16 April, 2024

FTSE 100 index can be expected to fall further toward the next support level 7760.00, former strong resistance from last year, acting as the support after it was broken this January.

Digital Assets

Cyprus keeps FTX EU license suspended until September

The Cyprus Securities and Exchange Commission (CySEC) has extended the suspension of FTX.com’s CIF license, which allowed the insolvent platform to operate throughout Europe, until September 30, 2024.

Metaverse Gaming NFT

Mon Protocol and Pixelverse Forge a Groundbreaking Partnership to Revolutionize Blockchain Gaming

Mon Protocol and Pixelverse make history in the annals of Blockchain gaming as they set up the architecture for the melding of their technologies.

Chainwire

Nimiq Pay Launch: A New Standard For Self-Custodial Crypto Payments

Nimiq, the blockchain ecosystem for payments that is designed to make cryptocurrency easy for everyone to use, has taken the first concrete steps towards its goal of becoming the world’s most widely-accepted digital asset for payments with the launch of Nimiq Pay.

Inside View, Interviews

Exclusive: GoMining’s Mark Zalan wants to democratize opportunities of Bitcoin halving

As the Bitcoin community counts down to the upcoming Bitcoin halving, Mark Zalan, CEO of GoMining, shared exclusive insights into how the company is gearing up for this pivotal event in the cryptocurrency world.

Digital Assets

Umoja Partners with Merlin Chain to Launch Revolutionary Bitcoin-Based Synthetic Dollar – USDb

Umoja, an innovative smart money protocol, has embarked on a strategic partnership with Merlin Chain, a leading Bitcoin Layer-2 network, to introduce USDb, the first Bitcoin-based, high-yield synthetic dollar.

Crypto Insider

Bybit Report Highlights Imminent Bitcoin Supply Shortage and Rising Scarcity Post-Halving

Bybit, recognized as one of the top three cryptocurrency exchanges globally in terms of trading volume, has recently published a comprehensive report highlighting the future supply constraints of Bitcoin.

blockdag

BlockDAG Outshines XRP Price Breakout and Uniswap Crypto Forecast with 20,000x ROI Potential and Teaser for Keynote on Moon

BlockDAG has become the latest sensation in the crypto world, which has taken the spotlight by storm, overshadowing even the most optimistic projections for XRP’s price breakout and Uniswap’s crypto forecast.

<