The Commodity Futures Trading Commission was granted a motion for entry of default judgment in a fraud case connected with binary options and retail foreign currency (forex) transactions.
Specifically, the motion for entry of default judgment is against California-based John D. Black and his affiliated entities Financial Tree; Financial Solution Group; and New Money Advisors, LLC; and his associates Christopher Mancuso and Joseph Tufo; as well as Colorado-based John P. Glenn and his law firm, The Law Firm of John Glenn, P.C.
The order finds they are liable for solicitation fraud in connection with binary options and forex transactions, fraud by commodity pool operators and associated persons, multiple CFTC registration violations, and failure to comply with CPO regulations.
The case was filed in the U.S. District Court for the Eastern District of California.
The order imposes on Black, Financial Tree, Financial Solution, New Money, Mancuso, Glenn, and Glenn’s law firm obligations to pay nearly $10.5 million in restitution jointly and severally; and Tufo to pay over $4.5 million of that restitution jointly and severally with the other defendants.
Further civil monetary penalties of approximately $5.4 million are imposed on Black, Financial Tree, Financial Solution, and New Money; $12.1 million on Mancuso; $680,000 on Tufo; and $850,000 on Glenn and his law firm. Additionally, the defendants are permanently enjoined from engaging in conduct that violates the Commodity Exchange Act (CEA), registering with the CFTC, and trading in any CFTC-regulated markets. In addition, it requires seven relief defendants to disgorge over $2.6 million they received from the scheme to which they have no lawful entitlement.
U.S. District Judge Troy L. Nunley found that from approximately June 15, 2015, to June 15, 2020, the defendants fraudulently solicited members of the public to contribute funds to fraudulent binary options and forex commodity pools; misappropriated millions of dollars of those funds for personal use; made Ponzi payments to existing pool participants with new pool participants’ funds; and made false statements to explain their failure to return funds and deliver promised profits.