The following is from the CFTC...
The U.S. Commodity Futures Trading Commission (CFTC) obtained a federal court Judgment requiring Defendants Kevin Harris, Keelan Harris, Complete Developments, LLC (CDL), andInvestment International Inc. (a/k/a/ I3), all of Warren, Ohio, and Karen Starr of Barrie, Ontario, Canada, collectively to pay restitution and civil monetary penalties of over $23 million for solicitation fraud and misappropriation in connection with operating a multi-million dollar off-exchange foreign currency (forex) Ponzi scheme (see CFTC Release 5921-10, October 7, 2010).
Judge David D. Dowd, Jr. of the U.S. District Court for the Northern District of Ohio entered the default Judgment and Memorandum Opinion on May 8, 2013, requiring CDL, I3, Kevin Harris, Keelan Harris, and Karen Starr to pay over $15.7 million in restitution to defrauded investors. The Judgment also imposes civil monetary penalties of $2.49 million on Kevin Harris, $2.49 million on Keelan Harris, and $2.64 million on Starr and permanently bans them, CDL, and I3 from trading and registering with the CFTC and from violating anti-fraud provisions of the Commodity Exchange Act (CEA), as charged.
The Court’s Memorandum Opinion finds that CDL, I3, Kevin Harris, and Starr violated anti-fraud provisions of the CEA by fraudulently soliciting customers to trade forex and misappropriating customer funds. The Opinion further finds that, from about November 2006 until October 2008, CDL and I3 fraudulently solicited and accepted funds from customers seeking to open “professionally managed” forex trading accounts and that customers invested more than $23 million. Rather than trading forex on their customers’ behalf, the Opinion finds that CDL and I3 operated as a Ponzi scheme and used customers’ money to make payments to other customers and for Kevin Harris, Keelan Harris, and Starr’s own personal use. The Opinion also finds that Kevin Harris, Keelan Harris, and Star controlled CDL and I3 and are liable for CDL and I3’s fraudulent conduct.
Relief Defendants Ordered to Disgorge over $1 Million of Ill-Gotten Gains to Investors
The Judgment orders Relief Defendants Majestic Enterprises Collision Repair, Inc. and UCAN Overseas Corporation S.A. to disgorge $302,277 and $768,000, respectively, consisting of customers funds that they received, but are not entitled to, as a result of the Defendants’ fraudulent conduct. The amounts disgorged are to be applied to the restitution ordered for CDL and I3 customers, according to the Judgment.
CFTC Division of Enforcement staff members responsible for this case are Karin N. Roth, Linda Y. Peng, Michael C. McLaughlin, David W. MacGregor, Lenel Hickson, Jr., Stephen J. Obie, and Vincent A. McGonagle.