We the members of the Scam Investigations Committee of the Forex Peace Army have deliberated on all the evidence available to us and have reached a conclusion. It is our opinion that...

In September of 2008, the FPA received a complaint from “JG” about his account with Atwood & James. JG told FPA Investigator Tessa that they had promised to returned the remaining $800 in his account as well as $1000 in compensation after making a severe error trading his account. Then he received $1000 and was told that this was all the money he would be getting.

At first, Tessa assisted JG with wording for emails. Michael Kardonick of Atwood and James wanted to communicate only by phone, and was always ready with excuses and reasons why the remaining $800 would not be returned. When Tessa sent an email to Kardonick trying to assist with negotiations, he not refused to reply to any FPA emails. He also send an email to JG making the wild claim that communicating with the FPA had violated JG's fiduciary agreement with Atwood & James and implying that the FPA was some sort of scam. Since Kardonick would not communicate directly with the FPA, Tessa helped JG continue his negotiations. Finally, On October 31st, Kardonick accused JG of blackmail, but said his New York office had instructed that a check be sent. The check took over 1 month to arrive and was written from a Singapore bank. This cost JG a large fee from his bank and the check took over 1 month to clear.

In mid-January, a second investigation was begun by FPA investigator Gerard in the a case brought by FPA member “PD”. She had an account with Atwood & James. Initially, the account had one very profitable trade. Then she heard nothing for some time. Barry Frank, her account representative, was supposed to stay in touch with her and keep her informed of all trades. When she tried to withdraw money, Atwood and James suddenly informed her of a trade that had wiped out her account. Previously, she had been told that Atwood and James uses a “weighted straddle” strategy to prevents any significant losses.

Atwood & James only provided trading statements as MS Word documents. Requests for real trading statements were ignored. We consider this to be strong evidence that no trading was really taking place.

After repeated requests for compensation, Michael Kardonick offered to place a trade and promised to pay her any profits above $2800 on the trade, if she would sign an agreement that this would be all the compensation she was entitled to. Gerard warned PD that this was very obviously a ploy where Kardonick would report little or no profit above $2800.

Gerard was preparing to send a final warning to Atwood & James that they needed to negotiate seriously or face a scam finding. Then someone send the FPA a link to a CFTC article. The CFTC is seizing assets belongin to Atwood & James and has charged Michael Kardonick and the company with fraud.

Failure to negotiate in good faith is a serious ethics violation. Failure to provide proof of real trading taking place in a managed account is, at best, a serious ethics violation. Failure to honor a contract and keep a trader informed about account activity is a serious ethics violation. Even if this company manages to survive in court against the criminal charges brough by the CFTC, they have committed numerous unethical actions against FPA members.

Thus, we officially find that Atwood & James is a scam. We offer Atwood & James the option to have this scam finding lifted by repaying JG for the expenses involved in cashing the check and by repaying PD her initial investment. Further, we would require that Atwood & James provide proof to PD that real trades took place and will have to be exonerated in the case the CFTC has brought against them.

We thank Tessa and Gerard for their efforts in this case. We are glad that JG got most of his money back. PD has been advised to file a claim with the CFTC in the hope that she can recover some of her money. The FPA has sent messages to the CFTC requesting the best method for PD to contact them.

Atwood & James is hereby blacklisted by the Forex Peace Army. We urge anyone who has placed money with this company to contact the CFTC immediately.

Discussion thread for this scam finding

CFTC Freezes Assets of Atwood and James
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