Binary options scammer who defrauded victims of $3.8m disappears – CFTC says

Maria Nikolova

The regulator cannot locate Peter Szatmari, who is accused of having operated a large-scale binary options fraud scheme.

The United States Commodity Futures Trading Commission (CFTC) is unable locate and effect service on a binary options scammer who defrauded victims of at least $3.8 million. This becomes clear from the latest filings in the case against Peter Szatmari.

On November 25, 2019, the CFTC moved the Hawaii District Court for an order authorizing the regulator to serve Szatmari by publishing notice in the Hawaii Star Advisor. Despite its diligent efforts, the Commission has been unable to locate and serve Szatmari.

On October 7, 2019, the CFTC filed a five-count Complaint against Szatmari, alleging serious violations of the Commodity Exchange Act, 7 U.S.C. §§1-26 (2012) (“Act”) and Commission Regulations 17 C.F.R. pts. 1-190 (2019).

Prior to filing its Complaint, the Commission engaged in settlement discussions with Szatmari and reached an agreement in principle. However, before executing the settlement documents, Szatmari backed out of the settlement, his attorney advised the Commission that he no longer represented Szatmari and Szatmari disappeared.

When the Commission asked Szatmari’s attorney for Szatmari’s contact information, he provided a P.O. Box in Kahului, Hawaii, and responded,

“Mr. Szatmari has instructed me that he does not want me to supply you with any additional information.”

According to the order and as alleged in the complaint, Szatmari lured prospective customers by disseminating fraudulent marketing materials in six marketing “campaigns.” These solicitations instructed unsuspecting investors to open and fund binary options accounts with “recommended” brokers to get free access to automated trading software that purported to generate astronomical profits with no risk of loss. According to the filings, these marketing materials included numerous false or misleading statements.

Szatmari also failed to disclose that he received a fee from the binary options brokers he recommended every time a new account was opened and funded as a result of his solicitations. Further, he failed to disclose that this fee arrangement was the sole basis for recommending brokers. Szatmari’s fraudulent solicitations were disseminated to and/or viewed by millions of prospective customers, with approximately 25,000 customers opening binary options trading accounts and funding those accounts, usually with an initial deposit of $250 or more.

In its litigation against Szatmari, the CFTC seeks full restitution to defrauded individuals, disgorgement of ill-gotten gains, a civil monetary penalty, permanent registration and trading bans, and a permanent injunction against further violations of the Commodity Exchange Act and CFTC regulations.

Read this next

Digital Assets

Zero Hash obtains AUSTRAC registration in Australia

Seed CX is expanding the reach of its crypto settlement solution, dubbed ‘Zero Hash,’ which has registered with the Australian Transaction Reports and Analysis Centre (AUSTRAC) as a digital currency exchange provider.

Digital Assets

UK advertising watchdog slams Arsenal over misleading crypto ads

The UK advertising watchdog has reprimanded Arsenal Football Club for promoting crypto assets without warning fans of the potential associated risks.

Retail FX

Swissquote profit slips as crypto revenue falls by two thirds

Swissquote Group, Switzerland’s provider of online trading services, reported that its H1 revenues dropped by nearly a quarter from a year ago as clients’ interest in crypto trading stagnated.

Digital Assets

Crypto.com granted approval to operate business in Cayman Islands

Crypto.com, one of the longest-established crypto platforms, has obtained a new registration in the Cayman Islands under the Virtual Asset Services Providers Act.

Executive Moves

United Fintech hires Mitch Vine and Danny Finnerty to expand US footprint

“United Fintech’s expansion in the US is pivotal to our mission of helping financial institutions digitize and gain access to best in class capital markets focused technology.”

Digital Assets

Ankr backed by Binance Labs after several initiatives in support of BNB Chain

Ankr has made a series of upgrades to the BNB Chain, including Erigon, the Archive Node, and the latest BNB Application Sidechain (BAS) scalability solution.

Retail FX

Financial Commission terminates membership of LordFX

The Financial Commission, an independent self-regulatory compliance specialist for the financial services industry, has expelled forex brokerage LordFX from its membership, according to a FinaCom statement.

Industry News

Match-Prime Liquidity sponsors Cypriot football club Omonoia FC

“We feel privileged to support Omonoia as it’s one of the largest teams in Cyprus, fandom size-wise, and we know it has a special connection with its supporters.”

Institutional FX

XTB’s X Open Hub adds 30 cryptos to white label offering for brokers

Its solutions include deep institutional liquidity on more than 5,000 global instruments, such as indices, shares, forex, cryptocurrencies, commodities, and ETFs, and a white label platform that can be fully customized and branded for each brokerage.

<