CFTC gets approval for alternate service on co-founder of binary options firm Berkley Capital Management

Maria Nikolova

Arie Bos has until July 18, 2019 to file an answer to the CFTC complaint.

Shortly after the United States Commodity Futures Trading Commission (CFTC) asked the Illinois Northern District Court to approve alternate service on Arie Bos, one of the defendants in a binary options fraud lawsuit, the Court has granted the request.

The lawsuit also targets William Thomas Caniff, Berkley Capital Management, LLC (BCM), BBOT 1, LP and Berkley II, LP. The CFTC alleges that the defendants engaged in a scheme whereby they fraudulently solicited and accepted at least $4.8 million from at least 62 commodity pool participants for the purpose of trading binary options on or subject to the rules of a designated contract market in pool accounts to be managed by BCM.

The CFTC alleges that all of the defendants committed options fraud, whereas Caniff is said to also have made a false statement to a registered entity.

Defendant Arie Bos is a natural person, 59 years of age, who resides in Rotterdam in the Netherlands and is a citizen of that country. Bos is a co-founder and Managing Partner of BCM and is a limited partner of BBOT and Berkley II. Bos was responsible for all “marketing” on behalf of BCM, and for “administration and reporting” to the funds limited partners and for “membership management” of BBOT and Berkley II and for the limited partnership’s offerings. Bos has never been registered with the CFTC in any capacity.

Earlier in June, the CFTC asked the Court for an order approving the Commission’s use of email to serve process on Bos. Alternatively, the Commission sought an order permitting service on attorney Michelle LaGrotta since she has acted as Bos’s legal representative throughout the communications with the Commission that preceded the filing of this lawsuit. The CFTC explained back then that the Netherlands is a signatory of the Hague Convention. Service on Bos in the Netherlands under the Hague Convention will cost thousands of dollars and take months to perfect service. Service in the Netherlands under the Hague Convention requires that the summary form be translated into Dutch and suggests that the other pleadings to be served also be translated into Dutch. Bos reads and understands English as demonstrated by his past phone and email communications with representatives of the Commission as well as in-person and email communications with at least one US Investor.

As per the latest Court filings, the Court has granted the CFTC’s request. The Court notes that the Commission has demonstrated that service of the summons and complaint upon Bos by the traditional method of using the Hague Convention would unduly delay these proceedings and would be very costly to the Commission. The Court finds it is reasonable to conclude that the Commission effected service of process by sending an email to Bos along with a copy of the summons and complaint on June 10, 2019, thereby giving Bos additional notice of this action and that due process has, therefore, been satisfied.

Bos shall have until July 18, 2019 to serve an answer to the complaint.

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