Wuna Lookut:
A New Zeek-Rewards 419 might be in the offing: Read my lips...This is what their email solicitation says:
"Discover the new formula to unlimited online wealth;
A Hybrid Business Model, Created To Bring Internet Marketing Mainstream called Beta-Testing via text messaging".
On further scrutiny by yours truly, it turns out the promoter of this new "Wealth Magical creation...$7000.00/Day scheme...is the same company that swindled almost 3.8 million dollars from hundreds of mugus recently claiming to invest in Forex Trading.
Herewith below is an excerpt of the case brought against the company (Prosperity Team LLC) by the EFTC. Simply amazing what some will do to transfer your hard earned dollars to their private pockets. ENJOY.
The (EFTC) Commission finds the following:
- Summary
During the Relevant Period, Respondents fraudulently solicited and accepted at least $5,482,000 from at least 183 individuals (collectively, "customers") primarily for the purpose of trading leveraged or margined off-exchange foreign currency contracts ("forex") through a pooled investment vehicle, also known as Prosperity Team LLC.
In soliciting potential customers through a website, other promotional material and personal interactions, Salazar-Correa falsely guaranteed monthly returns varying from 1 0-25% depending upon the amount invested and misrepresented the risks of trading forex.
Rather than the claimed 10-25% returns, Respondents consistently sustained trading losses, which culminated in overall losses of approximately $1,566,000 during the Relevant Period. Respondents also operated a Ponzi scheme, by misappropriating customers' funds to make payments to other customers.
Respondents concealed the massive trading losses and their misuse of customer funds to make payments to other customers by issuing false statements, which were accessible to customers online through Prosperity Team's website.
- Respondents
Prosperity Team, LLC, was a corporation organized under the laws of the State of Nevada from December 2006 to December 2010. Prosperity Team's office was located at Salazar-Correa's principal residence in Las Vegas, Nevada. Prosperity Team did business as "FX Prosperity." Prosperity Team is not, and has never been, registered with the Commission. Salazar-Correa was the Controlling Officer, Operating Manager, Secretary, Treasurer, Organizer, and Sole known Employee of Prosperity Team.
Luis Salazar-Correa resides in Las Vegas, Nevada at the same address as Prosperity Team. Salazar-Correa is a founder, incorporator, director, manager, officer, employee, and/or agent of Prosperity Team, LLC, and held himself out to the public as the person in charge of Prosperity Team. Salazar-Correa is not, and has never been, registered with the Commission.
- Facts
During the Relevant Period, Prosperity Team, by and through Salazar-Correa, solicited and accepted approximately $2,482,000 primarily for the purpose of trading forex through a pool, also known as Prosperity Team. Salazar-Correa controlled the operations of, and was the only known employee of, Prosperity Team.
Salazar-Correa solicited individuals to invest with Prosperity Team through a website he operated, personal interactions, and promotional material, such as emails and PowerPoint presentations. In his solicitations, Salazar-Correa guaranteed monthly returns varying from 10- 25% depending on the amount invested.
Specifically, Salazar-Correa guaranteed customers monthly percentage returns of a minimum of 10% up to 25% through a variety of listed "Plans." Plan 1, with the amount invested between $50-999, guaranteed monthly interest of 10%.
Plan 2, with the amount invested between $1000-4,999, guaranteed monthly interest of 12%.
Plan 3, with the amount invested between $5,000-24,999, guaranteed monthly interest of 15%.
Plan 4, with the amount invested between $25,000-49,999, guaranteed monthly interest of 18%.
Plan 5, with the amount invested over $50,000, guaranteed monthly interest of 20%.
There was also an introductory V.I.P. plan that guaranteed a monthly return of25%.
In his solicitations, Salazar-Correa also falsely represented that because he would pool customer funds with the funds of other customers; trading Forex with Prosperity Team was a low risk investment.
In order to invest with Respondents, Salazar-Correa, through Prosperity Team's website, directed individuals to wire money to corporate bank accounts held in the name of Prosperity Team. Salazar-Correa transferred a portion of the customer funds to his personal bank accounts, and from those accounts, funded trading accounts held in his name at over twenty (20) Futures Commission Merchants ("FCM"). In his trading, Salazar-Correa sustained trading losses of approximately $1,566,000. In order to perpetuate his fraud, he used the remaining funds, approximately $800,000, to make payments to customers in order to return principal or make the purported monthly returns based on his claimed trading success.
To conceal the massive trading losses and the misappropriation of customer funds to make Ponzi payments, the Respondents issued false statements to customers, through the website, reflecting that the customers' accounts were profitable. However, when customers asked for redemptions, Respondents could not honor those requests. Instead, Salazar-Correa gave excuses and used delay tactics. Such excuses included corporate reorganization efforts and moving Prosperity Team offshore outside the United States.
IV. LEGAL DISCUSSION
A. Respondents Committed Fraud In Violation of Section 4b(a) of the Act
Section 4b(a) of the Act prohibits all manner of fraud in, or in connection with Forex transactions, including fraudulent solicitation, misappropriation and issuance of false statements?
Section 4b(a)(2)(A)-(C) of the Act provides that it is unlawful: for any person, in or in connection with any order to make, or the making of, any contract of sale of any commodity for future delivery, or other agreement, contract, or transaction subject to paragraphs (1) and (2) of section Sa(g), that is made, or to be made, for or on behalf of, or with, any other person, other than on or subject to the rules of a designated contract market - (A) to cheat or defraud or attempt to cheat or defraud the other person; (8) willfully to make or cause to be made to the other person any false report or statement or willfully to enter or cause to be entered for the other person any false record; (C) willfully to deceive or attempt to deceive the other person by any means whatsoever in regard to any 'order or contract or the disposition or execution of any order or contract, or in regard to any act.
Respondents knowingly guaranteed returns on investments and claimed that trading forex with Prosperity Team was low risk when Respondents knew their trading had consistently resulted in losses. These statements were knowingly false. Misrepresentations regarding profitability are exactly the types of statements that a "reasonable investor would consider ...
important in making an investment decision. Salazar-Correa used customer funds held in Prosperity Team corporate bank accounts in order to make payments to other customers, in a manner akin to a Ponzi scheme. Accordingly, Respondents misappropriated customer funds in violation of Section 4b(a)(2)(A) and (C) of the Act.
3. Fraud by Issuance of False Statements
Issuing or causing to be issued false statements to customers concerning the profitability Of Forex trading conducted on their behalf violates Section 4b(a) of the Act.
Salazar-Correa controlled Prosperity Team, directly or indirectly, and did not act in good faith or knowingly induced, directly or indirectly, Prosperity Team's act or acts in violation of the Act, as amended.
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