CFTC hits Rudy Avila and six FX companies with fraud charges
The Commodity Futures Trading Commission (CFTC) has charged a Texas resident and six U.S. and Costa Rican companies for illegally collecting $6 million from 230 individuals in an alleged forex fraud.
According to a statement posted on the CFTC’s website, Rudy Avila had solicited U.S. residents to trade foreign currency (forex) contracts as well as other assets through a commodity pool operated by associated companies.
The six companies charged are The L.I.F.T. Group LLC (LIFT), CIG Internacional Sociedad Anónima ( CIG) and Trading Technologies Group Sociedad Anónima (TTG) organized in Costa Rica, Trading Ventures Group, LLC (TVG), Capital Ventures Group, LLC (CVG), and Ventures Group, LLC (VGL.). The complaint also charges CIG and TVG with failure to register as Commodity Trading Advisors (CTA).
Through two separate schemes, defendants allegedly lured investors to invest in their supposedly high-returning FX trading scheme, promising huge returns in a short time. Rather than trade, the money invested was eventually routed to Avila’s bank accounts. The bulk of the victim’s funds were used to pay for personal expenses and to make Ponzi-type payments to early investors.
Created in 2017 and dissolved in February 2020, the investment pools didn’t generate any income.
Rudy Avila also failed to register with the CFTC as required, and fraudulently sought participants by lying about the company’s market position and investment track record.
Right now, the CFTC is aiming for civil monetary penalties, restitution, and permanent bans on registration and trading against the defendants.
The CFTC has been active recently as US regulators continue their cleanup of the forex space, this time with charges of fraud being brought against a dozen of brokers and trading apps.
The US regulators have also warned Americans about criminals trying to steal their funds using several scams tied to the coronavirus pandemic. Moreover, they warned of the substantial potential for fraud at this time, saying that crooks often try to capitalize on high-profile news events to lure investors into financial cons.
Furthermore, the CFTC identified fraudsters urging people to invest in new stocks related to the disease as among the most prevalent scams attempting to take advantage of the coronavirus outbreak.