CFTC Orders $7.2 Million in Restitution and a Civil Monetary Penalty for Solicitation Fraud and for Making False Statements

Order Also Permanently Bars Atlantas Group and Hysni from the Commodity Industry

The U.S. Commodity Futures Trading Commission (CFTC) today issued an Order filing and simultaneously settling charges against Respondents Atlantas Group, Inc. (Atlantas) and Edmund Hysni for committing solicitation fraud in connection with options on futures contracts trading on the Chicago Board of Trade and the Commodity Exchange, Inc., and against Hysni for willfully making material false statements to the National Futures Association (NFA) in connection with its investigation of the fraud.

Hysni, who resides in Waterford, Michigan, was the sole owner and president of Atlantas, which had its principal place of business in Waterford. Neither is currently registered with the CFTC.

The CFTC Order requires Atlantas and Hysni, jointly and severally, to pay restitution of $5 million and a $2.2 million civil monetary penalty; permanently prohibits them from trading on any registered entity, as defined in the Commodity Exchange Act (CEA), or registering with the CFTC; and bars them permanently from engaging in any commodity-related activities. The Order also requires them to cease and desist from violating the provisions of the CEA and CFTC Regulations, as charged. read more »

A Bank Too Big to Jail

Have you ever wondered why the crippling 2008 financial crisis generated almost no criminal prosecutions of large banks and their top executives?

Then take a moment to read the congressional report issued on July 11 titled “Too Big to Jail.” Citing internal documents that the United States Treasury took three years to produce, the report shows how regulators and prosecutors turned a potential criminal prosecution of a large global bank — HSBC — into a watered-down settlement that insulated its executives and failed to take into account the full scope of the bank’s violations.

The report, prepared by the Republican staff of the House Financial Services Committee, does not examine a matter related to the mortgage crisis. Rather, it looks at the Department of Justice’s 2012 settlement with HSBC, the British banking behemoth, after accusations that it laundered nearly $900 million for drug traffickers and processed transactions on behalf of Cuba, Iran, Libya, Sudan and Myanmar, or Burma, when those countries were subject to United States sanctions. read more »

Herbalife agrees to pay $200-million settlement and change its business practices

Herbalife Ltd. agreed Friday to pay $200 million and change its business practices to settle federal regulators’ claims that it falsely told people they could quickly get rich by selling its weight-loss shakes, teas and other supplements.

The Federal Trade Commission issued a stinging rebuke of the Los Angeles-based company’s business model, saying in its complaint that Herbalife had misled people into becoming its distributors or its members with videos and brochures showing mansions, fancy cars and boats and telling them they could quit their jobs.

The “overwhelming majority” of distributors “earn little or no money,” the government said. And many have lost thousands of dollars after being encouraged to lease space to set up “Nutrition Clubs,” where people pay a daily fee to drink a protein shake and tea.

“Herbalife is going to have to start operating legitimately, making only truthful claims about how much money its members are likely to make,” said FTC Chairwoman Edith Ramirez, “and it will have to compensate consumers for the losses they have suffered.” read more »