Despite CFTC’s efforts, whereabouts of Yossi Herzog remain unknown

Maria Nikolova

According to the regulator, Herzog is not currently in Israel and attempts to determine his current geographic location have been unsuccessful.

As the United States Commodity Futures Trading Commission (CFTC) tries to press ahead with its action against a large-scale fraudulent binary options scheme evolving around Israeli firm Yukom Communications, the regulator continues to experience trouble with locating the defendants in the case and effecting service on them.

Earlier today, the CFTC filed a motion with the Illinois Northern District Court for an order for alternative service on several defendants in this case – Yukom Communications Ltd., Yakov Cohen, Yossi Herzog and Shalom Peretz.

The CFTC seeks the Court’s authorization to serve Yukom, Cohen, Herzog and Peretz by: (1) sending the Summons and Complaint via “ordinary” mail, no signature required, to their last known addresses; (2) sending the Summons and Complaint by email to accounts used by the three individual defendants in connection with the fraudulent conduct at issue; and (3) publishing a notice in the Times of Israel.

On August 12, 2019, the Commission filed its five-count Complaint charging Yukom, Linkopia Mauritius Ltd., Wirestech Limited d/b/a BigOption, WSB Investment Ltd d/b/a BinaryBook, Zolarex Ltd. d/b/a BinaryOnline, Cohen, Lee Elbaz, Herzog and Peretz with fraudulently soliciting individuals throughout the United States and other countries to enter into illegal, off-exchange transactions in binary options through fictitious entities using the trade names “BigOption,” “BinaryBook,” and “BinaryOnline”.

The Complaint alleges that the Yukom Defendants operated a global retail binary options enterprise whose employees and agents made material misrepresentations and omissions to induce customers to trade, including by misrepresenting the profit potential and fundamental nature of the binary options offered and failing to disclose that Yukom was on the opposite side of all customer trades, and that the defendants fraudulently accepted at least $103 million in customer funds.

The Commission has yet to serve Yukom, an Israeli entity, and Cohen, Herzog and Peretz, all of whom are Israeli citizens currently located outside the United States.

Herzog is an Israeli citizen who resided in Zichron, Israel during the relevant time.

On August 14, 2019, and after confirming Herzog’s registered address with the ISA, the CFTC sent the Summons and Complaint to Herzog’s residence via Registered Mail. As of January 13, 2020, those documents cannot be traced and are therefore likely undelivered.

According to the CFTC, Herzog is not currently in Israel. CFTC counsel has communicated with representatives of various foreign financial regulatory agencies in an ultimately unsuccessful attempt to determine Herzog’s current geographic location and identify alternative addresses for service. Despite the Commission’s efforts, Herzog’s whereabouts are currently unknown.

Herzog is among the defendants indicted in a criminal case in the District of Maryland. According to the DOJ, no representative of Herzog has contacted the US authorities.

Read this next

Digital Assets

DappRadar report: NFTs volume below $1 billion for the first time since June 2021

DappRadar’s July 2022 industry report found that blockchain games and their NFTs remain resilient amid a crypto winter accentuated by the debacle of Terra.

Digital Assets registers to operate crypto business in Italy had registered as a digital asset provider in Italy, following in the tracks of rivals who joined a special registry with brokerage regulator Organismo degli Agenti e dei Mediatori (OAM).

Digital Assets

Binance rolls out crypto card in Argentina with 8% cashback

Binance is launching its crypto debit card in Argentina, the first country in Latin America to have the product thanks to a partnership with Mastercard.

Digital Assets

Greece sends BTC-e operator Alexander Vinnik to US

Alexander Vinnik, an alleged Russian hacker accused of laundering $4 billion of criminal proceeds through BTC-e, has been extradited from Greece to the United States.

Retail FX

Saxo Bank reports weakest FX volume in 6 months

As many traders were away on annual summer leave, currency markets saw a relatively quiet period in July. Within that context, Copenhagen-based Saxo Bank has reported its monthly metrics, which showed a renewed decline month-over-month.

Market News

The Week Ahead: 5 August from David Madden, Market Analyst at Equiti Group

It has been an interesting week and despite a lot of negative news, equity markets enjoyed a positive run. US House Speaker, Nancy Pelosi, defied the warnings from the Chinese government and carried out a visit to Taiwan. The Beijing authorities moved military hardware close to the self-governed island to flex its muscles. Stock markets came under a little pressure as a result and risk-off assets like the Japanese yen and gold found themselves in high demand.


Alina Strogonova of Muvon Payments: How Can Fintech Optimise Payments

Financial services in their conventional form are obsolete, according to fintech startups. New-age finance is constantly redesigning electronic money transactions and testing innovative solutions.

Digital Assets

No need for CFDs: BitMEX introduces leveraged FX perpetual swaps

Previously retail FX trading was mostly possible via CFDs (contract for difference). BitMEX’s FX perps allow both retail users and institutional traders to access FX markets through an exchange-traded contract.

Digital Assets

BEQUANT launches index measuring dollar against crypto

“Our research team has worked hard to quantify and capture the latest economic story into the broader crypto market.”