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Alternative Market Briefing

$4.5m in fines ordered as CFTC brings spate of enforcement actions

Wednesday, October 24, 2012

Bailey McCann, Opalesque New York: The Commodities Futures Trading Commission (CFTC) announced a round of enforcement actions today totaling some $4.5m in fines. Three separate actions involved financial market participants engaged in either forex or commodities fraud in the US.

A federal court order has been requiring defendants Robert A. Christy of Milton, Ga., and his company, Crabapple Capital Group LLC of Alpharetta, Ga., to pay over $2.6 million in monetary sanctions for foreign currency (forex) fraud. In this case the court found that Christy defrauded 22 individuals who contributed $1,416,000 to an investment pool operated by Crabapple to trade forex. The order states that over the course of several years from 2008-2011, Christy represented that his firm had a strong track record of forex trading when, in fact, he'd sustained consistent losses. He then used investor contributions to fund his own lifestyle and personal checking account while making false representations to them and the NFA. Christy and his firm were initially charged with this fraud in April.

In a second action, the CFTC noted that it simultaneously filed and settled charges against David Kaup of San Gabriel, California, and his California-based companies, Lunden Forex Partners, LP, Lunden Forex Management, LLC, Black Horse Funds, LLC, Black Horse Management, LLC, and Black Horse Partners, LP. The charges alleged that Kaup defrauded investors out of approximately $1.4m by misrepresentin......................

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