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2009 Managed Forex Scam of the Year Nominees
(in chronological order)
(in chronological order)
CreCapCorp.com
Would you like to make 10% monthly on your investment? Bernie Madoff only offered 10% per year in his Ponzi operation. Someone asked about this company in the FPA's forums and was warned that it sounded like a Ponzi scam. The VP, Robert Gaubert complained to the FPA about “False and unsubstantiated comments posted” in the FPA's forums. Two who had placed money with the company posted statements in the forums about what a good and honest company it was. Two months later, the SEC and CFTC stepped in and called it a 25 million dollar Ponzi scheme.
Article about CRE Capital Corporation
Original complaint against CreCapCorp. Please read this to see how investors were lured in.
FPA Scam Finding against CreCapCorp.com
AtwoodJames.com
There were two complaints against this company. In the first one, Michael Kardonick told someone who complained to the FPA that such a complaint violated the agreement between the client and Atwood & James. After many delays, he eventually repaid what was owed, but in a way that ended up costing the client a large amount in fees that seemed very unnecessary. In the second case, a trader lost a large amount of money in spite of claims that a "weighted straddle" strategy would protect against large losses. All trading statements were provided as word documents. Before negotiations could be finished, the CFTC stepped in and charged Michael Kardonick and his company with fraud. Losses are well over 1 million dollars.
Article about Atwood & James
FPA Scam Finding against AtwoodJames.com
4xMaster.net
Their website promised that maximum drawdown would be less than 21%. Instead, after profitably trading for awhile, they wiped out most of the account in two days. The person who complained about this to the FPA tried to get them to reduce the risk after the first day, but risky trading and large losses continued. All attempts to contact the company were ignored.
Article about 4x Master
FPA Scam Finding against 4xMaster.net
InternationalForeignCurrency.com
IFC was run my Mike Kritch and Patrick Gallagher. Two FPA members complained that their LPOAs were violated regarding risk management. One was specifically told that his account could be wiped out by a single trade of 60 lots. Two weeks later, this happened. Offers to trade back the losses came to nothing. After lenthy negotiations failed to produce any real action from IFC, the FPA declare the company to be a scam.
Article about International Foreign Currency
Original complaint against InternationalForeignCurrency
FPA Scam Finding against InternationalForeignCurrency.com
CapitalBlu.com
Capital Blu and others were charged by the CFTC with running a fraudulent commodity pool. They collected about $17 million and lost about $7 million trading. They also spent lavishly, including for a $40,000 party at a "gentlemen's club" that lasted for two nights. Someone had a good time, but it wasn't the investors.
Article about Capital Blu
FPA Scam Finding against CapitalBlu.com
Next-Consultancy.com
Initially, accepted money directly and didn't pay out promised withdrawals. The original complaint was withdrawn when the investor thought that money was really on the way. Many months later, 2 new complaints can up about individual accounts suffering large losses. These were caused by the company completely ignoring the risk management rules that were promised to traders. During negotiations, many promises were made and then broken. When a final deadline was missed, the FPA declare this company to be a scam.
Stay tuned for a possible update on this one soon.
Article about Next Consultancy
Original complaint against Next-Consultancy
FPA Scam Finding against Next-Consultancy.com
CFSCap.com
CFS Capital Markets and some of those associated with it faced numerous charges by the NFA, including reallocating money between customer accounts to cover up losses. The final settlement resulted in CFS losing its NFA membership, one of the owners being permanently barred from the NFA membership, and another one being barred for 5 years.
Article about CFSCap
FPA Scam Finding against CFSCap.com
MyTIRN.com
Traders International Return Network has all the warning signs of being a Ponzi. These were ignored by investors who were too eager to get the high returns promised. There was a long debate in the FPA's forums over this until the CFTC filed charges against the owner and the company. Despite this, some eager participants are throwing their money away on new websites claiming to be TIRN's new home.
There was even a new update on this in the discussion thread within the last day.
The Scam discussion article is embedded into this discussion thread. The FPA recommends reading the whole thread to see how some people refuse to give up on the false promises from My Tirn.
FPA Scam Finding against MyTIRN
UniversalBrokerageFx.com
UBFX offered what they claimed were managed forex accounts with Crown Forex. When Crown got started to go bad, one of their associates tried to claim that everything was fine with Crown, even after the regulators seized control of the company. He later tried to delete everything he'd written in the FPA's forums. It turns out that UBFX's owners also bought a significant part of Crown Forex and were in a position to know exactly what was going on. It seems that a lot of money was never even placed into brokerage accounts and there were some Ponzi style operations going on.
Article about Universal Brokerage Fx
Crown Forex Thread where UBFX associate tried to hide what he'd written
FPA Scam Finding against UniversalBrokerageFx.com
