Despite assurances that depositors could not lose more than 20% of the funds they deposited, the defendants lost over $1 million trading forex and misappropriated at least $415,000 more to spend on Hass’s mortgage, credit card debt, and a Caribbean cruise.
The U.S. District Court for the District of Oregon issued a consent order against Erik J. Hass and Simply Gains, Inc., concluding a legal action initiated by the Commodity Futures Trading Commission (CFTC) on June 9, 2020.
The case accused them of fraudulently soliciting millions for forex trading without the necessary registration as mandated by the Commodity Exchange Act. Simply Gains, Inc. solicited at least $2.1 million from at least 21 individuals to fund their Forex commodity pool operation.
Despite assurances that depositors could not lose more than 20% of the funds they deposited, the defendants lost over $1 million trading forex and misappropriated at least $415,000 more to spend on Hass’s mortgage, credit card debt, and a Caribbean cruise.
This order comes after Hass admitted guilt in a related criminal case, committing to full restitution to those defrauded. In addition to acknowledging the restitution, the court mandated an $830,000 civil penalty against the defendants. They are also prohibited from trading on futures or options markets, registering with the CFTC, or engaging in activities violating the Commodity Exchange Act.
CFTC won FX fraud cases against Oasis and Satellite
In December, the CFTC achieved significant victories in two major retail forex fraud cases, resulting in substantial judgments and penalties against the perpetrators, Michael DaCorta and Avinash Singh. These cases underscore the CFTC’s commitment to combating financial fraud and protecting investors.
Michael DaCorta, associated with Oasis International Group, Limited, Oasis Management, LLC, and Satellite Holdings Company, was found guilty of defrauding around 800 individuals of over $80 million. The court ordered DaCorta to pay more than $61 million in restitution and civil monetary penalties. The scheme involved soliciting funds under false pretenses for forex trading, but instead, the money was used for personal luxuries.
Avinash Singh and his company Highrise Advantage, LLC were ordered by the court to pay over $102 million in restitution and penalties. Singh’s scheme involved fraudulent solicitation of almost $58 million from investors, of which less than $2.5 million was used for intended forex trading. The majority of the funds were misappropriated or used for Ponzi-type payments, leading to significant financial harm to investors.
