A U.S. District Court in Florida has ruled against Avinash Singh and his company, Highrise Advantage, LLC, in a default judgment.
The Commodity Futures Trading Commission (CFTC) had brought charges against Singh, Highrise, and others involved in an elaborate foreign currency scheme.
Per court papers, Singh and his company engaged in fraudulent activities, soliciting and misappropriating funds through a master commodity pool and several feeder pools. The court found that only a fraction of the nearly $58 million collected from investors was used for actual trading. Over $25 million was misappropriated, with funds being diverted to personal expenses and Ponzi-type payments.
The judgment includes a permanent injunction against Singh and Highrise, permanently bars them from registering with the CFTC or trading on any registered entity. Additionally, they are ordered to pay over $100 million in restitution and civil penalties.
This ruling follows consent orders entered against the operators of the four feeder commodity pools implicated in the scheme. These pools, operated by Surujpal Sahdeo, Daniel Colegero, Randy Rosseau, and Hemraj Singh, were also part of the enforcement action.
In a related criminal case, Singh faces charges of wire fraud and money laundering, brought by the U.S. Attorney for the Middle District of Florida. As a result, he is facing up to 20 years in federal prison for each wire fraud count and up to 10 years for each money laundering count.
Between February 2013 and September 2020, Singh was accused of defrauding over 1,100 victims, accumulating millions under the guise of investing in FX markets. He lured investors with false claims of a successful forex trading track record and promises of guaranteed safety for their funds against trading losses.
However, these representations were far from the truth. Rather than investing the funds in forex trading as promised, Singh had been running a classic Ponzi scheme, using funds from new investors to pay existing ones. Out of the sums he received, Singh misappropriated roughly $45 million for payments to other investors and millions more for personal expenses, investing less than 5% in actual forex trading.
To cover his fraud, Singh issued fabricated monthly statements, falsely showing profitable forex investments. In reality, the few investments he made often resulted in losses, which he attempted to conceal with these falsified statements.
In a bid to recover assets for the victims, the Asset Recovery Division of the U.S. Attorney’s Office has filed a civil complaint seeking the forfeiture of a residence bought with more than $920,000 derived from these fraudulent activities.