IMM fined with more than $9.8 million for illegal precious metals transactions after CFTC complaint

IMM fined with more than $9.8 million for illegal precious metals transactions after CFTC complaint

- in All News, Government, Regulation
CFTC fine

The U.S. Commodity Futures Trading Commission (CFTC) today announced that a Florida District Court granted the CFTC’s motion for entry of final default judgment against International Monetary Metals, Inc. (IMM), and its former president, Martin Sommers. The judgment requires the defendants to repay, jointly and severally, fraudulent gains amounting to $2,469,783 and a civil penalty totaling $7,409,349. A permanent trading, solicitation, and registration bans are also imposed against IMM (and Mr. Sommers).

The judgment finds that IMM acted as an unregistered Futures Commission Merchant (FCM), soliciting or accepting orders for retail commodity transactions and accepted funds. In this way IMM received a total of $2,469,783 in commissions from 185 retail customers.

This judgment actually stems from a CFTC Complaint, filed back in September, 2014, that charged IMM and Sommers with engaging in illegal, off-exchange transactions in precious metals (gold and silver) with retail customers on a leveraged, margined, or financed basis. According to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, such off-exchange transactions are illegal, unless they result in actual delivery of metals (within 28 days).

According to the judgement, metals were never actually delivered to IMM’s clients in connection with the company’s transactions, either by defendants or by their wholesalers – Worth Group Inc. (Worth) and AmeriFirst Management, LLC (AmeriFirst). By the way, The CFTC previously brought enforcement actions against both Worth and AmeriFirst in U.S. Courts.

CFTC says it will continue to fight for the protection of customers and to ensure the wrongdoers are held accountable. US regulator often imposes massive penalties, although such court orders requiring repayment of funds to victims may not always result in the recovery of any money lost, since wrongdoers may not have sufficient funds or assets.

Earlier in July Binary Brokers OptoinsVault & GT 365 have been fined with more than 4.5 million following a CFTC complaint.

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