WASHINGTON The U.S. Commodity Futures Trading Commission on Wednesday sued 14 firms that it alleged illegally solicited investors to participate in foreign currency transactions.
In its first crackdown since new enforcement powers went into effect in October, the futures regulator said the firms were operating without being registered as foreign exchange dealers with the agency.
The enforcement actions were filed in Federal District Courts in Chicago, the District of Columbia, Kansas City and New York.
The new regulations, which were granted through the 2008 Farm Bill and last year's Dodd-Frank Act, require dealers in the forex market to register with the CFTC and abide by regulations intended to protect the public.
In all but two of the complaints, the CFTC alleged that defendants acted as retail foreign exchange dealer, offering to or taking the opposite side of a customer's forex transaction without being registered.
In the remaining two complaints against ZtradeFX LLC and FXPRICE, the CFTC alleged the firms solicited customers to place forex trades without being registered as brokers.
The following companies were sued by the CFTC as part of this sweep:
* EuroForex Development LLC, a Delaware LLC;
* FIG Solutions Limited, Inc., a Delaware corporation;
* ForInvest, a Delaware corporation;
* FXOpen Investments Inc., a Delaware LLC;
* FXPRICE, a Delaware LLC;
* GIGFX, L.L.C., a Delaware company;
* InovaTrade, Inc., a company with purported offices in Florida;
* InstaTrade Corporation d/b/a InstaForex, a British Virgin Islands company;
* InvesttechFX Technologies, Inc., a Canadian corporation located in Toronto;
* J&K Futures, Inc., a company with purported offices in California and New York;
* Kingdom Forex Trading and Futures, Ltd., a Nevada company;
* Prime Forex, LLC, a Delaware LLC;
* Wall Street Brokers, LLC, a Delaware LLC; and
* ZtradeFX LLC, a Connecticut LLC.
(Editing by Lisa Shumaker)