Delaware Resident Kenneth Branch and his company, Cocoon Trade, Inc., Ordered to Pay More than $1.5 Million in Restitution and Penalties in CFTC Commodity Pool Fraud Action
The U.S. Commodity Futures Trading Commission (CFTC) announced today the entry of a Consent Order of Permanent Injunction against Kenneth L. Branch (Branch) of New Castle, Delaware and a Default Judgment Order (Default Order) against Cocoon Trade, Inc (Cocoon). The Orders require Branch and Cocoon collectively to pay $632,787 in restitution to defrauded customers and [...]
CFTC Extends Public Comment Period on Concept Release Regarding Review of Exemptions for Swap Dealers
The Commodity Futures Trading Commission (CFTC) is extending the public comment period on the concept release regarding review of exemptions for swap dealers.
The comment period for this request is set to expire on May 26, 2009, but based on several public requests for an extension, the Commission is extending the comment period for an additional [...]
CFTC Charges Texas A&M Finance Professor Robert Watson, and Texas Attorney Daniel Petroski and their Companies with Fraud in Multi-Million Dollar Forex Scheme
The U.S. Commodity Futures Trading Commission (CFTC) today charged Robert D. Watson (Wastson), an executive professor in the Department of Finance at Texas A&M University’s Mays Business School, Daniel J. Petroski (Petroski), a Texas lawyer and certified public accountant, with orchestrating a multi-million dollar fraudulent off-exchange foreign currency (forex) scheme. Watson and Petroski managed two [...]
NFA Release on Forex Account Statements
[http://www.forexlawblog.com]
New Rule Requires Better Reporting to Retail Forex Investors
Forex Dealer Members (FDMs) are subject to NFA oversight because they are required to be registered with the CFTC and also to be members of the NFA. On June 1 of this year, FDMs will need to comply with heightened disclosure requirements to their retail forex investors. [...]
Another Forex Fraud
CFTC Freezes Assets of Fraudulent Forex Traders
The CFTC announced another forex scam targeting retail forex investors. Like many frauds which we have detailed over the last few months, this fraud would likely have been detected earlier if the investors had made some basic inquiries into the claims made by the fraudsters. This action again shows [...]
Forex Trading Platforms
Information for Forex Managers and Forex Introducing Brokers
The press release below discusses a new forex trading platform designed for forex managers. Many forex managers will use such platforms in their automated trading programs. In many instances the platform can be integrated with forex trading robots as well.
NFA Interpretive Notice Re: Hypothetical Performance Results
One of the most important area of the forex disclosure documents is the discussion of past results. Of increased importance in this area is the disclosure of hypothetical trading results. The CFTC and the NFA believe strongly that hypothetical performance results must be presented in marketing materials in a fair and balanced way.
The release below [...]
NFA Compliance Rule 2-29
RULE 2-29. COMMUNICATIONS WITH THE PUBLIC AND PROMOTIONAL MATERIAL.
(a) General Prohibition.
No Member or Associate shall make any communication with the public which:
(1) operates as a fraud or deceit;
(2) employs or is part of a high-pressure approach; or
(3) makes any statement that futures trading is appropriate for all persons.
Forex Law Question – Forex Managers and the Series 7 Exam
Question: If I trade spot forex in a fund structure, do I need a Series 7 exam license?
Answer: If a hedge fund manager trades in the spot off-exchange foreign currency (forex) markets and is not associated with a broker dealer, then the investment activities of the manager do not require a series 7 exam license.
Forex Hedge Fund Group Ordered to Pay Penalties for Forex Fraud
In one of the more interesting forex fraud actions I have seen, a forex hedge fund acted as a counterparty to transactions with retail investors. Generally off-exchange foreign currency trades with retail customers can only be completed by firms which are Futures Commission Merchants or Forex Dealer Members, and who are also registered with the [...]
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