CFTC secures default judgment against ApuroFX, Jin Choi, and JCI in Forex fraud case
The defendants are ordered to pay a civil monetary penalty of $1.1 million.
The California Central District Court has granted a motion by the Commodity Futures Trading Commission (CFTC) for a default judgment against Jin Choi, Apuro Holdings, Ltd. (d/b/a ApuroFX), and JCI Holdings USA (d/b/a JCI Trading Group, LLC) in a Forex fraud case.
On Tuesday, March 5, 2019, Judge Dolly M. Gee entered a judgment in favor of the CFTC and against the defendants.
The defendants are permanently restrained from, inter alia, entering into any transaction involving “commodity interests”, as well as controlling or directing trading on or behalf of any other person or entity in any account involving commodity interests. They are also prohibited from soliciting, receiving, or accepting any funds from any person for the purpose of purchasing or selling any commodity interests. They defendants are also restrained from applying for registration or claiming exemption from registration with the CFTC in any capacity, and engaging in any activity requiring registration or exemption from registration with the CFTC.
The defendants are ordered to pay restitution in the amount of $1,121,672 plus post-judgment interest, as well as a civil monetary penalty in the amount of $1,121,672, plus post- judgment interest.
On May 14, 2018, the CFTC filed a Complaint for Injunctive and Other Equitable Relief and for Civil Monetary Penalties Under the Commodity Exchange Act and Commission Regulations against the defendants for violations of the Commodity Exchange Act.
Defendant Jin Choi resides in Los Angeles, California, and owns and operates AHL, ApuroFX, JCI Holdings, and JCI Trading Group. Choi is a citizen of the Republic of South Korea who appears to have entered the United States in April 2015 on a F1-Visa. Choi has never been registered with the CFTC in any capacity.
According to the CFTC’s Complaint, from at least January 2014 and continuing through the present, Jin Choi, acting individually and as the principal and agent of Apuro and JCI, fraudulently solicited and accepted at least $1,155,572 from fourteen individuals for the purported purpose of trading off-exchange leveraged or margined retail Forex contracts on their behalf. The defendants solicited and continue to solicit clients or prospective clients through investor seminars hosted by Choi in the United States and abroad, social media accounts and various websites operated by Choi.
Choi and the entities he operated are said to have made material misrepresentations in their solicitations including by misrepresenting that clients’ funds would be used to open trading accounts in their names and to trade forex on their behalf and that ApuroFX is registered with the CFTC as a futures commission merchant (FCM) and a member of the National Futures Association.
In reality, the defendants did not conduct any Forex trading on behalf of the clients. Of the $1,155,572 the defendants solicited for FX trading, Choi deposited only $3,000 of these funds into a forex trading account in Choi’s name at Forex Capital Markets, LLC (FXCM). Choi opened the FXCM account in mid-April 2016, with a deposit of $3,000, and he was the sole person authorized to trade in the account. However, no trading occurred in the FXCM account, and Choi closed the FXCM account in early-May 2016 after withdrawing the $3,000 he originally deposited.
The defendants misappropriated all of the money they obtained from clients and used these funds to support Choi’s lavish lifestyle, including the rental of a Beverly Hills, California condominium and the purchase and lease of luxury automobiles.
The majority of clients were unable to obtain a return of any of their funds despite their repeated demands to the defendants.