Daily fraud update: 29th November

Unlicensed FX trader convicted of investor fraud

An unlicensed broker who scammed his clients has been sentenced to three to six years in prison by the New York County Supreme Court.

The fraud cost investors more than $489,000 lost in an FX trading scheme.

Jason Amada persuaded victims that he was a trusted pair of hands for trading Forex safely and that their investments would be protected by capital preservation strategies.

In stark contrast, Amada used aggressive trading tactics including high levels of leverage that led to a complete dissipation of his victims’ funds.

The bogus broker earned more than $150,000 in fees and commissions from his fraudulent activities.

He was sentenced after signing confessions of judgement in his eight victims’ favour.

Amada, 42, of Forest Hills, Queens, pleaded guilty to Grand Larceny in the Second Degree in September after an indictment charged him with fraudulently soliciting a client to invest €250,000.

After a month and a half of aggressive foreign currency trading, Amada had lost 99% of her principal.

Additional victims came forward after his arrest, leading to a total fraud amount of more than $489,000.

Amada did not disclose to his clients that he had not held a broker license since 2012 and presented himself as a successful Forex trader who operated across several legitimate investment management companies.

Various firms named by Amada to back up his claims turned out to be shell corporations which had no genuine operations or any employees.

None of the companies were registered as forex trading bodies with any of the relevant regulatory authorities either.

Amada also defrauded his clients by using invested funds to pay for personal expenses.

In the three years between 2015 and 2018 he incurred expenses worth around $100,000 on travel, dining, clothes, credit bills and personal loans.

Furthermore, Amada issued payments to family members and other associates having taken out cash from invested funds.

The fraud went unnoticed by clients in the first instance because of the way in which Amada carefully concealed trading losses that were occurring by providing victims with account statements which were fakes.

Each month, Amada created detailed accounts of profitable trades which he lied about having made, providing elaborate statements to his victims via email.

The false statements claimed increasing profits and account balances that were going up, and the deceit went on for years in the cases of multiple victims.

The truth about the misappropriation of the funds only came to light when clients asked for the return of their investments and Amada was not able to do this and the whole fraud came tumbling down around him.

Last September, Amada entered a guilty plea to the counts of Grand Larceny in the Second Degree and Scheme to Defraud in the First Degree, both of which are felonies and were charges brought against him by the Attorney General’s Criminal Enforcement and Financial Crimes Bureau.

Chris Lee

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