CFTC goes after Forex fraudsters falsely claiming to have accounts at FXCM
The websites of Blackbox Pulse and Unique Forex published false statements about accounts at FXCM – these accounts never existed.
The United States Commodity Futures Trading Commission (CFTC) on Monday launched a Forex fraud case at the New Jersey District Court, targeting scammers who did not hesitate to defraud their own parents.
The case, captioned Commodity Futures Trading Commission v. Lanzana d/b/a Unique Forex et al (2:17-cv-06290), has among its defendants Thomas Lanzana, Nikolay Masanko, Blackbox Pulse LLC, and White Cloud Mountain LLC.
The Complaint, seen by FinanceFeeds, alleges that Lanzana, individually and as the controlling person of Blackbox Pulse and doing business as (d/b/a) Unique Forex, and Masanko, individually and as the controlling person of White Cloud Mountain, defrauded at least thirty pool customers of at least $700,000 in connection with pooled investments in retail off-exchange Forex transactions and other investments.
From at least 2013 to the present, through social media, websites, and word of mouth, Lanzana presented himself as a successful Forex trader to solicit and accept customer funds for the purpose of trading Forex at Blackbox Pulse or Unique Forex. His emails to customers featured account statements and links to YouTube videos showing FX trades that were never made. In reality, Lanzana did not use all of the customer funds he accepted to trade forex, but instead misappropriated a portion of those funds to pay other customers who requested the return of their funds, in the manner of a Ponzi scheme, and his own personal use and benefit.
By at least 2014, Masanko, who had previously worked with Lanzana as a broker at various firms registered with FINRA in the late 1990s and early 2000s, started referring friends and family members (including his own parents) to Unique Forex. For the customers he solicited, Masanko received a percentage of the performance fees that Lanzana charged.
Masanko marketed White Cloud Mountain through a website (www.whitecloudmountain.com), social media, and word of mouth as a successful forex trading company.
- False claims about FXCM accounts
Additionally, Lanzana made available to FX customers purported statements for Blackbox Pulse and Unique Forex accounts at Forex Capital Markets LLC (FXCM), which was registered with the CFTC as a retail foreign exchange dealer until March 2017.
These statements made it appear as if Blackbox Pulse and Unique Forex traded an account worth hundreds of thousands of dollars at FXCM. For instance, Lanzana emailed at least one customer a May 2015 account statement for a Blackbox Pulse, LLC account ending in 6205 at FXCM that showed total equity in excess of $470,000.
In reality, no account in the name of “Blackbox Pulse, LLC” and/or “Unique Forex” exists at FXCM.
FXCM records show that Lanzana did, however, maintain two personal FX trading accounts in his own name at FXCM, one of which ended in 6205, the same account number appearing on the fake May 2015 FXCM account statement for Blackbox Pulse. Lanzana opened the real 6205 account in his own name in approximately February 2013; the balance of that account never exceeded $4,314.57. Lanzana opened his other FXCM account, ending in 6383, in his own name in approximately October 2015; the balance of that account never exceeded $5,215.23. FXCM terminated both accounts on approximately September 8, 2016.
The real and fake FXCM account 6205 statements for May 2015 differ wildly: while the fake May 2015 Blackbox Pulse 6205 account statement shows trading profits of more than $70,000, a deposit of $100,000 and an ending balance of more than $470,000, Lanzana’s real 6205 account statement for May 2015 shows a trading loss, no deposits, and an ending balance of only $3,474.41.
Since approximately 2016, Lanzana has stopped returning all funds to customers who have requested the withdrawal of their funds, and has instead tried to keep customer funds via a series of misrepresentations and false promises.
The CFTC accuses the Defendants of:
- Fraud in Connection with Forex;
- Manipulative or Deceptive Device, Scheme, or Artifice to Defraud;
- Fraud by a Commodity Pool Operator and an Associated Person of a Commodity Pool Operator;
- Failure to register as a Commodity Pool Operator;
- Failure to register as an AP of a Commodity Pool Operator;
- Prohibited Activities of a Commodity Pool Operator.
The regulator is seeking, inter alia, civil monetary penalties, as well as a preliminary injunction against the defendants to prohibit them from any violations of the Commodity Exchange Act and CFTC regulations.
