Just yesterday, Commodity Futures Trading Commission (CFTC) has announced the charges against the Frank J. Collins and Gerard Suite and their company, STA Opus NR LLC, adding another Commodity pool fraud to its list of unrevealed fraudulent schemes. Is your broker reliable?
August 10, AtoZForex – Commodity Futures Trading Commission (CFTC), the US regulatory body, which strives to foster transparent, open and competitive markets, has been very successful in targeting firms and individuals related to frauds and illegal trading activities. Yesterday US watchdog has announced that California Residents Frank J. Collins and Gerard Suite and their company, STA Opus NR LLC have been charged with fraud, misappropriation, and failing to register with the CFTC.
CFTC unmasks Commodity Pool Fraud
To be more specific, CFTC has filed a civil enforcement action in the US District Court, Central District of California, setting charges against two individuals and their company with fraudulently soliciting at least $1.6 million from at minimum 30 clients. The funds were allegedly used for operating a commodity pool. Also, Defendants Frank J. Collins of Garden Grove, California, and Gerard Suite of Irvine California (who is also known by many pseudonyms, including Rawle Gerard Suite, Jerry Suite, and Jerry Snead), allegedly misappropriated nearly $1.25 million of clients’ funds for their personal benefit.
Additionally, CFTC’s Complaint charges Defendants with issuing false account statements to clients in order to hide their fraud. Moreover, the Complaint alleges that STA Opus was acting as a Commodity Pool Operator (CPO) and Defendants were acting as Associated Persons of the CPO, even though they were not registered with CFTC essentially.
Defendants’ and STA Opus’ fraudulent scheme
The CFTC Complaint also highlights that in the period from at least January 2013 to the present, Defendants have fraudulently solicited clients through their company, STA Opus. Supposedly, the Defendants were falsely representing that STA Opus’ commodity pool had positive yearly rates of return. However, in reality, STA Opus’ three commodity futures accounts had negative returns and the Defendants were virtually losing all of the funds they dedicated to trading.
Furthermore, as a part of their fraudulent scheme, the Defendants allegedly demanded some clients to send them ‘voided’ personal checks, which were giving Defendants the access to clients’ bank account numbers and bank account information. This way, Defendants were able to withdraw the funds directly from clients’ bank accounts.
Additionally, as CFTC unmasks Commodity Pool Fraud, the CTFC Complaint also accuses Defendants of failing to disclose to customers that previous sanctions were issued against Suite canceling his registration with the CFTC and ordering him and his entities to pay $2.5 million in restitution and fines for breaching the regulatory framework in California.
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