An affiliate marketer named Peter Szatmari must pay more than $13.8 million for fraudulently soliciting investors to open and fund binary options accounts on websites operated by unregistered brokers.

According to the Commodity Futures Trading Commission (CFTC), the U.S. District Court for the District of Hawaii entered an order of default judgment against Szatmari on September 14.

The default judgment follows an order by Judge Derrick K. Watson on August 13. Judge Watson adopted the findings and recommendations of Magistrate Judge Kenneth J. Mansfield on July 28, 2020.

The court order requires Szatmari to pay approximately $6.25 million in restitution to defrauded customers, $1.9 million in disgorgement, and a civil monetary penalty of $5.7 million.

Additionally, the order permanently prohibits Szatmari from violating the Commodity Exchange Act, registering with the CFTC, and trading in any CFTC-regulated markets.

The order resolves the CFTC's complaint against Szatmari and his business partner, David Sechovich.

CFTC accused Szatmari and his business partner of fraud

In October last year, the CFTC filed charges against Szatmari and Sechovich for allegedly creating and disseminating fraudulent solicitations of binary options trading.

The CFTC alleged that Szatmari and his business partner lured approximately 25,000 customers to open and fund binary options trading accounts. They alleged pitched free access to automated trading software that they claimed to generate significant profits with little to no risk of loss.

Additionally, they allegedly misled customers by portraying actors or fake personalities as actual owners or users of the automated trading software. They also allegedly depicted fictitious trading results as real.

Szatmari and Sechovich allegedly generated $3.8 million in fees while the customers lost most or all of their funds in their accounts.

Affiliate marketing is a form of performance-based marketing that promotes third-party products and services, such as binary options trading. Affiliate marketers such as Szatmari and Sechovich usually solicit customers using emails and/or posts on the internet.

----------------------------------

Have a story you want USA Herald to cover? Submit a tip here and if we think it's newsworthy, we'll follow up on it.

Want to contribute a story? We also accept article submissions -- check out our writer's guidelines here.