Federal Court Finds Defendant Liable for Violating CFTC Ban on Trading Binary Options Off-Exchange

A federal court issued a consent order requiring defendants to pay restitution and a civil monetary penalty for violating the CFTC ban on trading binary options off-exchange. The court ordered the defendant and his companies ("corporate defendants") to pay $7.1 million in restitution and a $2 million civil monetary penalty for violating the CFTC ban on off-exchange options trading by executing commodity option contracts with U.S. customers, and for failing to register properly as a futures commission merchant. The court found that the corporate defendants, all of whom are located outside the U.S., acted as counterparties to their customers' binary options transactions on a variety of assets, including commodities, forex pairs and stock indices. The defendant was held as the "controlling person" for the corporate defendants' violations.