Page 77 - 《期货和衍生品行业监管动态》（2022年合集）

期货和衍生品行业监管动态

The jury trial commenced on January 31, 2022. Without admitting or denying the
allegations in the complaint, the defendants consented to settle on all claims during

the CFTC’s presentation of its case, on the fourth day of trial.

“This matter demonstrates the CFTC will continue to focus on customer

protection and vigorously litigate the cases it files to obtain appropriate relief,” said

CFTC Acting Director of Enforcement Vincent McGonagle. “As required by the

Commodity Exchange Act and CFTC regulations, commodity trading advisors must

ensure they are providing accurate and complete information to potential customers so

they can make informed decisions before entering into an advisory relationship.”

Case Background

According to the order, which adopted the parties’ agreed findings of fact and

conclusions of law, from approximately 2016 through 2018, Friedland and his

companies fraudulently solicited customers and prospective customers to purchase a
digital asset known as Compcoin. The defendants falsely promised, among other

things, that Compcoin would allow customers to gain access to what they described as

Fintech’s proprietary forex algorithmic trading program known as ART.

In solicitation materials, the defendants represented, among other things, that the

ART trading algorithm was “complete in form and function,” and “ready for release

on the open market.” The defendants also represented that “ART’s high success rate

at predicting...forex trades, coupled with the high rate of return from these trades, will

stimulate demand among investors and forex traders to purchase and use

Compcoin—specifically to gain access to ART.”

As reflected in the order, the defendants knew that customers could not lawfully

use ART until Fintech received approval of its disclosure documents from the

National Futures Association (NFA). Nonetheless, the defendants offered Compcoin

prior to Fintech seeking NFA approval of its disclosure documents. Although the
defendants touted the successful performance of ART, they knew that its performance,

which was referenced in solicitations, was based largely or entirely on hypothetical

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