Florida Federal Court Orders Defendant to Pay More than $2 Million in a Foreign Currency Fraud Scheme

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CFTC

Florida Federal Court Orders Defendant to Pay More than $2 Million in a Foreign Currency Fraud Scheme

November 6, 2019

CFTC - foreign currency Washington, DC — The U.S. Commodity Futures Trading Commission today announced that the U.S. District Court for the Middle District of Florida entered a judgment in a CFTC enforcement action against Allied Markets, LLC of Florida, finding that the company operated a fraudulent foreign currency trading (forex) pool and misappropriated its customers’ funds.

The court’s order requires Allied Markets to pay a civil monetary penalty of approximately $1.2 million, and $1.2 million in restitution to defrauded clients. The order also permanently bans Allied Markets from engaging in any commodity-related activity and violating provisions of the Commodity Exchange Act (CEA) and CFTC regulations as charged.

The judgment against Allied Markets follows a March 4, 2019 judgment against Allied Markets’ principals Joshua Gilliland and Chawalit Wongkhiao, both of Florida. Gilliland and Wongkhiao were also permanently banned from engaging in any commodity-related activity and violating provisions of the CEA and CFTC regulations as charged.

The orders against Allied Markets, Gilliland, and Wongkhiao stem from a CFTC complaint filed on January 5, 2015, charging the defendants with fraudulent solicitation and misappropriation of commodity pool participant funds. [See CFTC Press Release 7100-15] The orders find that the defendants violated the anti-fraud provisions and registration requirements of the CEA and CFTC regulations in connection with their operation of an illegal commodity pool trading in forex.

According to the orders, defendants committed numerous misrepresentations and misappropriated their customers’ funds, using them to pay lavish personal expenses, including gym memberships and luxury car rentals.

In a parallel criminal case filed in the same district court, Gilliland and Wongkhiao pleaded guilty to conspiracy to commit wire fraud, based in part on the CFTC’s complaint. On February 1, 2016, the court sentenced Wongkhiao and Gilliland to 55 months and 15 months in prison, respectively. In addition, the court entered a money judgment against Wongkhiao and Gilliland in the amount of $1,120,831, which is equivalent to the proceeds of the fraud. [See United States v. Gilliland et al, No. 3:15-cr-00035-MMH-PDB]

The CFTC cautions victims that restitution orders may not result in the recovery of money lost because the wrongdoers may not have sufficient funds or assets. The CFTC will continue to fight vigorously for the protection of customers and to ensure the wrongdoers are held accountable.

The Division of Enforcement staff members responsible for this case are Jonah E. McCarthy, Patricia Gomersall, Dmitriy Vilenskiy, and Paul G. Hayeck, as well as former Enforcement staff members Jonathan Robell and John Einstman.

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CFTC’s Foreign Currency (Forex) Fraud Advisory

The CFTC has issued several customer protection Fraud Advisories that provide the warning signs of fraud, including the Foreign Currency Trading (Forex) Fraud Advisory, which states that the CFTC has witnessed a sharp rise in forex trading scams in recent years and helps customers identify this potential fraud.

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