CFTC marks progress in action against FX fraudster Jason Amada

Maria Nikolova

According to the proposed consent order, Jason Amada and Amada Capital Management LLC will have to pay restitution of $596,700.

The United States Commodity Futures Trading Commission (CFTC) has marked progress in its action against Jason Amada and Amada Capital Management LLC.

On April 10, 2020, the Commission and the defendants moved the New York Southern District Court for entry of Proposed Consent Order for Permanent Injunction and Other Equitable Relief against Jason Amada and Amada Capital Management LLC. The Proposed Consent Order, if entered by the Court, will resolve all of CFTC’s claims against the defendants in the First Amended Complaint without conducting a trial on the merits.

According to the proposed order, seen by FinanceFeeds, the defendants have to pay restitution of $596,700.

Furthermore, the defendants are permanently restrained, enjoined and prohibited from defrauding any person in connection with any retail Forex transaction, any contract of sale of commodity for future delivery or swap. The defendants are also permanently restrained, enjoined and prohibited from entering into transactions involving “commodity interests”. They are also permanently restrained, enjoined and prohibited from applying for registration with the CFTC, and from acting as principals of entities registered with the Commission.

Let’s recall that, in August 2018, the CFTC filed an enforcement action against Jason Amada and Amada Capital Management LLC (ACM), a New York entity owned and controlled by Amada. The CFTC Complaint charges that, from at least February 2014 through at least November 2015, the defendants fraudulently solicited potential clients to open individually managed trading accounts for off-exchange foreign currency contracts (forex) and hid substantial trading losses incurred as a result of the defendants’ managed forex trading.

Specifically, the Complaint alleges that the defendants fraudulently solicited clients for these accounts by, inter alia, misrepresenting the defendants’ FX trading experience and profitability. In addition, the Complaint alleges that the defendants made the false claim that they would implement a hedging strategy that would prevent losses of more than one percent. As further alleged, the defendants attempted to conceal mounting losses by transferring some of their commissions into a client’s account. The Complaint also alleges that the defendants failed to register with the CFTC as required.

In its continuing litigation, the CFTC seeks civil monetary penalties, permanent registration and trading bans, disgorgement, and a permanent injunction against further violations of the Commodity Exchange Act and CFTC Regulations, as charged.

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