The Securities and Exchange Commission and the Commodity Futures Trading Commission have filed separate yet parallel securities fraud lawsuits against a Texas money manager accused of bilking investors in a foreign-exchange trading scheme. Kevin G. White allegedly took approximately $1.7 million of the $7 million of investor funds he raised by making false claims that his currency trading strategy had brought about returns of over 393% since it was first implemented in January 2009.
The Commission filed its Texas Securities case in federal court early last month. The regulator believes that White and his companies used bogus credentials and its “can’t miss trading strategy” to reel investors into its scam when, in reality, the money manager was experiencing forex trading losses and misappropriating customer funds.
The CFTC’s action seeks to freeze White’s assets, as well of those of RFF GP LLC, Revelation Forex Fund LP, and KGW Capital Management LLC. Like the SEC, this regulator wants trading bans, financial penalties, and disgorgement of ill-gotten gains.
According to the North American Securities Administrators Association, forex scams are usually promoted via sophisticated-sounding ads in media and online. Promoters may claim that investors get leverage via “control” of foreign currency with a payment that is just a fraction of total cost along with the likely possibility of currency price rises and the promise of huge returns with little (if any) risks.
Signs You May Be Looking at a Forex Trading Scam:
• It sounds “too good to be true.” I.e.: Promises of big profits fast coupled with low risks, ‘get rich quick” enticements.
• Investments were promoted via unsolicited phone calls, especially from unfamiliar companies or sales persons not in state.
• High-pressure, “buy immediately” sales tactics.
Our Texas securities fraud lawyers represent investors of forex trading scams, penny stock schemes, Ponzi scams, elder financial fraud scams, CDO fraud, MBS fraud, and other types of financial scams. Contact Shepherd Smith Edwards and Kantas, LTD, LLP today.
Texas Money Manager Sued by Regulators Over Forex Fraud Claims, Bloomberg, July 12, 2013
SEC Folds Forex Fraud, The Street, July 16, 2013
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