Fraud

Florida residents and firm fined USD4m for defrauding investors

The US Commodity Futures Trading Commission has obtained a default judgment order requiring FX Professional International Solutions and its principals, Pedro de Sousa and Guillermo Rosario, to pay more than USD4m in civil monetary penalties for issuing false account statements to customers in an off-exchange foreign currency fraud.

The default order stems from a CFTC complaint, filed in the US District Court for the Southern District of Florida on 13 July 2010.

The court’s default judgment order finds that Rosario and de Sousa solicited at least USD535,000 from four customers to trade forex contracts through FXP and falsely represented that, since 2002, FXP had annual forex trading profits of 21 per cent to 85 per cent with no losing years. However, FXP did not exist before 2004, according to the default order.

Furthermore, the order finds that Rosario and de Sousa sent customers false monthly account statements, showing monthly profits from 2005 through 2008; however, the defendants’ forex trading resulted in monthly losses in 31 of 40 months during that period.

At the same time the CFTC complaint was filed, the Federal Bureau of Investigation arrested de Sousa and Rosario based on criminal charges filed by the US Attorney’s Office for the Southern District of Florida.

The default order requires Rosario, de Sousa and FXP to jointly and severally pay a civil monetary penalty of USD4,080,000, permanently bans them from trading on markets subject to the CFTC’s jurisdiction or registering with the CFTC and prohibits them from violating the fraud provisions of the Commodity Exchange Act.

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