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The Commodity Futures Trading Commission (CFTC) filed a lawsuit against four companies and five individuals who operated a global binary options fraud scheme.

The CFTC identified the defendants as David Cartu, Jonathan Cartu, and Joshua Cart (collectively, Cartu brothers), Leeav Perez and Nati Perez (collectively, Perez brothers), and Ryan Masten. The Cartu brothers and Perez brothers are Canadians while Masten is an American.

Masten’s company, Barelt Mnedia LLC doing business as SignalPush and the offshore entities owned and controlled by one of the Cartu brothers including All Out Marketing Limited, Blue Moon Investments, Ltd., and Orlando Union Inc were also named as defendants in the case.

Charges against the defendants

In the complaint, the CFTC alleged that the defendants operated a massive fraudulent binary option trading scheme between May 2013 and April 2018.

The Cartu brothers and the Perez brothers allegedly offered illegal, off-exchange binary option trading on currency pairs, oil, and other commodities to retail customers via several websites under the BeeOptions, Glenridge Capital, and Rumelia Capital binary option brands.

The defendants allegedly made material misrepresentations about their identity, financial expertise, physical location, compensation structure, and other material information to lure customers deposit funds and trade binary options.

The Cartu brothers and the Perez brothers lied to their customers that they are offering profitable binary option transaction. They allegedly promised “quick” returns of “60 to 85%.” In reality, most of their customers are losing money.

Additionally, the CFTC alleged that the Cartu brothers operated the defunct payment processor, Greymountain Management Limited, which they used to transfer customer funds for their illegal, off-exchange binary option transactions.

During the relevant period, the defendants processed more than $165 million credit card payments for binary options transactions that were executed on an internet-based trading platform operated by Masten and the Cartu brothers.

Furthermore, the CFTC alleged that the defendants used Greymountain to distribute millions of dollars in profits to offshore accounts.

The CFTC filed its complaint against the defendants in the U.S. District Court for the Western District of Texas. It is seeking disgorgement of ill-gotten gains, civil monetary penalties, restitution for the benefit of customers, permanent registration and trading bans, and a permanent injunction from future violations of the Commodity Exchange Act.