CFTC secures entry of default against fraudulent binary options scheme Circle Society

Maria Nikolova

The defendant was duly served with the summons and complaint in the action brought by the CFTC but has failed to plead within the time prescribed by the law.

The United States Commodity Futures Trading Commission (CFTC) has managed to secure a clerk’s entry of default against Circle Society, an allegedly fraudulent binary options scheme.

In this civil enforcement action launched in the Nevada District Court, the CFTC charges David Gilbert Saffron of Las Vegas, Nevada and Circle Society, Corp., a Nevada corporation, with fraudulent solicitation, misappropriation, and registration violations relating to an $11 million binary options scheme Saffron operated through Circle Society.

As per the latest Court filings in this case, seen by FinanceFeeds, the Court’s clerk has granted the CFTC’s motion for entry of default as to Circle Society. The CFTC has made the request for such an entry on grounds that the defendant was duly served with the Summons and Complaint in this action but has failed to plead within the time prescribed by the Federal Rules of Civil Procedure.

The CFTC complaint alleges that from at least December 2017 to the present, the defendants fraudulently solicited and accepted at least $11 million worth of bitcoin and US dollars from individuals in the United States to trade off-exchange binary options on Forex and cryptocurrency pairs, among other things.

According to the complaint, the defendants fraudulently solicited funds from at least fourteen members of the public to participate in a pool operated by Circle Society, an entity Saffron created and used to perpetrate his fraud, by making false claims of Saffron’s trading expertise and guaranteeing rates of return up to 300%.

The defendants misappropriated funds, including by retaining participants’ funds in Saffron’s personal electronic cryptocurrency wallet and by using funds to pay other participants, in the manner of a Ponzi scheme. The defendants then lied to participants in order to conceal their misappropriation.

The US regulator seeks full restitution to defrauded investors, disgorgement of ill-gotten gains, civil monetary penalties, permanent registration and trading bans, and a permanent injunction against future violations of the Commodity Exchange Act and Commission regulations.

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