The U.S. Commodity Futures Trading Commission has brought a lawsuit against a pair of Canadian citizens, alleging that they are involved in a foreign currency Ponzi scheme.

The CFTC announced Friday that it has filed suit against Karen Starr of Barrie, Ont., and Patrick Cole and Global Strategic Marketing Inc., both of Mississauga, Ont., along with brothers Kevin and Keelan Harris and their companies, Complete Developments LLC and Investment International Inc., all of Warren, Ohio, charging the defendants with fraud and misappropriation in connection with the operation of a multi-million dollar Ponzi scheme.

The complaint alleges that, from about November 2006 until October 2008, the U.S. firms fraudulently solicited and accepted millions of dollars from hundreds of individuals to open ‘professionally managed’ accounts for the purported purpose of trading off-exchange forex contracts. However, rather than trading forex on their customers’ behalf, it alleges that they operated a Ponzi scheme. The allegations have not been proven.

The CFTC says it is seeking disgorgement of ill-gotten gains, restitution to defrauded customers, civil monetary penalties, permanent injunctions against further violations of federal commodities laws and trading and registration bans. It notes that the Ontario Securities Commission, along with a variety of U.S. law enforcement organizations, aided the investigation.

IE