Foremost Trading LLC Must Pay $400K to CFTC for Supervisory Violations

Foremost Trading LLC and has settled the securities charges filed against it by the US Commodity Futures Trading Commission. The regulator accused the introducing broker of failing to properly supervise the handling of specific trading accounts by employees, agents, and officers. To settle, Foremost must pay a $400K civil penalty and cease and desist from future CFTC regulation violations.

According to the agency’s order, the accounts involved were held by clients who were referred to the introducing broker via three unregistered entities that sold futures trading systems. Foremost and its staff are accused of disregarding warning signs that the systems-Systems Providers-were using fraudulent means and business practices to get these clients.

Clients complained to Foremost. However, contends the CFTC, the latter did not properly investigate claims or let other clients know about the allegations. Meantime, the introducing broker kept setting up accounts for clients referred to it by Systems Provider, even vouching for the latter’s track record when communicating with clients.

Securities Fraud
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CFTC Orders Foremost Trading LLC, an Introducing Broker, to Pay $400,000 for Supervision Violations, CFTC, September 20, 2013

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