SEC charges Sanjay Singh with $112 million Forex scam
Sanjay Singh allegedly misappropriated at least $14 million of investor funds and diverted more than $19 million of investor funds to two brokerage accounts he controlled, engaged in highly speculative equities trading on margin in those accounts, and, as a result, lost more than $1 million of investor money.
The Securities and Exchange Commission has charged Sanjay Singh with fraudulently raising approximately $112 million from as many as 1,500 investors through an unregistered securities offering that primarily targeted Haitian-Americans.
The Florida resident allegedly his trucking and logistics company, Royal Bengal Logistics Inc., to offer and sell investors high-yield investment programs that purportedly generated 12.5 to 325 percent in guaranteed returns.
High-yield investments with guaranteed returns of 12.5% to 325%
This took place between 2019 and 2023, according to the SEC, which added that Singh’s Royal Bengal promised investors the company would use its money to expand operations and increase its fleet of semi-trucks and trailers.
Although he assured investors that these investment programs were safe, and that Royal Bengal generated up to $1 million in revenue per month, Royal Bengal was in fact operating at a loss and Sanjay Singh used approximately $70 million of new investor funds to make Ponzi-like payments to other investors, the SEC complaint states.
Sanjay Singh allegedly misappropriated at least $14 million of investor funds and diverted more than $19 million of investor funds to two brokerage accounts he controlled, engaged in highly speculative equities trading on margin in those accounts, and, as a result, lost more than $1 million of investor money.
Eric I. Bustillo, Director of the SEC’s Miami Regional Office, said: “As alleged in our complaint, Singh targeted many members of the Haitian-American community to raise money in a Ponzi-like scheme to enrich himself. We are committed to holding accountable individuals like Singh who prey on investors through lies and deceit.”
CFTC won case against $15.7 million FX scam
The CFTC has recently entered an order of default judgment and permanent injunction against Kay Yang for fraud in connection with retail foreign currency transactions that targeted the local Hmong community.
Kay Yang, Founder and CEO of AK Equity and Xapphire, was found to have engaged in a fraudulent scheme through which she solicited and received at least $15.7 million from approximately 67 individuals or entities for participation in a commodity pool that purported to trade forex. The FX scam took place between April 2017 and March 2020.
Kay Yang was found to have lied to existing and potential pool participants that she successfully managed hundreds of millions of dollars in a variety of investment vehicles, consistently achieved positive monthly returns, and would allocate 100% of pool participants’ funds to forex trading while adhering to a trading strategy that included low leverage ratios and moderate trading frequencies.
The claims were found to be false as the defendants routinely suffered trading losses using high leverage and high-frequency trading strategies, while she used pool participants’ funds to pay for personal expenses, including over $700,000 at casinos and on gambling-related purchases, more than $439,000 on travel and luxury hotels, and at least $248,000 on cars and car-related expenses.
Most pool participants were members of the Hmong community in Wisconsin, according to the CFTC, which added that FX fraud operation misappropriated at least $4.8 million of pool participants’ funds and spent that money on Yang’s personal expenses, including spending nearly $1.4 million at casinos and on luxury hotels and cars.
Kay Yang and her companies are being ordered to pay $13,692,690.27 in restitution to defrauded victims and a $10,387,635.91 civil monetary penalty. Kay Yang’s husband, relief defendant Chao Yang, is being ordered to pay $1,422,430.42 in disgorgement.
The order found Yang and her companies are liable for fraud in connection with retail forex transactions, fraud by a commodity pool operator (CPO) and an associated person of a CPO, and registration violations. The order further found relief defendant Chao Yang received $1.4 million, which was derived from the fraud. The order, entered on June 5, stems from a CFTC complaint filed on April 13, 2022.
The financial watchdog calls customers and other individuals to report suspicious activities. Whistleblowers are eligible to receive between 10 and 30 percent of the monetary sanctions collected paid from the Customer Protection Fund financed through monetary sanctions paid to the CFTC by violators of the CEA.
