CFTC Slaps a Fraudulent Binary Options and Digital Asset Scheme with $7 Million Fine

The US Commodity Futures Trading Commission (CFTC) announced that Daniel Fingerhut, Itay Barak, Tal Valariola and Digital Platinum Limited (DPL) are ordered to pay a combined $7 million in disgorgement and civil monetary penalties for role in fraudulent binary options and digital asset scheme.

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According to the press release, on May 5, 2020, CFTC filed a complaint charging Fingerhut, Barak, Valariola, DPL and others with fraudulently soliciting tens of millions of customers and prospective customers to open and fund off-exchange binary options and digital assets trading accounts.

The orders find that Fingerhut, Barak and Valariola created, disseminated and/or facilitated the use of fraudulent solicitations in emails, websites, and video sales letters promising free access to purportedly successful automated trading systems that traded on behalf of clients in binary options involving commodity interests and digital assets.

The order against Fingerhut also finds that he knowingly made false statements to the CFTC in connection with the investigation into his role in the fraud. The orders require Fingerhut to pay $400,011 in disgorgement and a $600,000 civil monetary penalty, and Barak, Valariola and DPL to pay $3 million in disgorgement and a $3 million civil monetary penalty.

"The CFTC cautions victims that restitution orders may not result in the recovery of money lost because wrongdoers may not have sufficient funds or assets. The CFTC will continue to fight vigorously for the protection of customers and to ensure the wrongdoers are held accountable,"the commission stated.