CFTC approves settlement with “Real Time Trade Room” promoters
Clients of the “Real Time Trade Room” were promised high returns if they follow the futures contract trades made “live” by a “veteran trader”.
The United States Commodity Futures Trading Commission (CFTC) on Tuesday informed the New York Southern District Court that it had approved a settlement in a case against FTS Financial Inc and Kevin Michael Symons over a fraud involving the aggressively promoted “Real Time Trade Room”.
As per the documents filed on October 24, 2017, the CFTC and Defendants FTS and Symons request that the Court enter a Consent Order for Permanent Injunction, Civil Monetary Penalties and Other Equitable Relief Against Defendants FTS Financial, Inc. and Kevin Michael Symons.
If entered by the Court, the Order resolves all of Plaintiff’s claims against the defendants in this case.
On September 26, 2016, the CFTC filed a complaint against FTS Financial Inc and Kevin Michael Symons. To effect settlement of all charges alleged in the complaint, the Defendants consent to the Order for Permanent Injunction, Civil Monetary Penalties and Other Equitable Relief.
According to the allegations, FTS Financial Inc, based in Irvine, California, was in the business of marketing to clients various financial services, including the “Real Time Trade Room”, from at least August 2012 and continuing through or around November 2013. Symons was owner of FTS and controlled its day-to-day operations.
The Room was marketed as an online forum in which subscribers, for a fee, could observe an individual as he ostensibly traded futures contracts. The supposed trader was marketed as trading “live” and in “real time”. FTS told clients they could make money by buying and selling the same futures contracts in their own accounts, following the trades that were purportedly being made live in the Room.
FTS made between 700 and 1,000 cold calls a day to solicit clients to buy access to the Room. The one time fee was up to $7,500 for six months.
The person trading in the Room was described as a “highly respected veteran trader with tremendous consistency”. In fact, the “trader” never actually traded any futures contracts in the Room, much less earned his livelihood from futures contract trading profits. The agreement signed by the clients said that the trades in the Room were virtual (simulated).
The defendants were accused of fraud by misrepresentations and omissions and of failure to provide required disclosures.
Under the Consent Order, the defendants are prohibited from engaging in any way in commodity interest trading; acting as commodity trading advisors, commodity pool operators or their associated persons; and from acting as principals or employees of an entity registered or required to be registered with the Commission.
FTS shall pay disgorgement of $2.4 million, whereas Symons shall pay $289,000 in disgorgement. The Order is also imposing civil monetary penalties on the defendants. FTS has to pay $2.4 million in civil monetary penalties, whereas the CMP amount to be paid by Symons is $100,000.