Kelvin Ramirez — Forex Fraudster
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On July 19, 2019, the Commodity Futures and Trading Commission (CFTC) announced that Kelvin O. Ramirez had been fined over $2.9 million for soliciting money from clients using fraudulent claims and then embezzling the money instead of trading FX on behalf of his clients as he had promised.
Ramirez violated the Commodity Exchange Act (CEA) by embezzling his clients' funds and using the money to fund his lavish lifestyle. He also claimed to be managing millions of dollars in client assets, which was completely false.
How the scam was executed
The scam was carried out from 2015 up to the present where Ramirez convinced unsuspecting customers to invest in commodity pools, which purported to trade the foreign exchange market, and misappropriated the funds invested by his clients.
He also claimed that he was managing millions of dollars in client funds, yet the CFTC found that he did not manage any funds at the time he made these claims, which was a material misrepresentation of facts.
Ramirez claimed to be making thousands of dollars every week from trading his
His solicitations usually had a sense of urgency attached as he claimed to have a limited number of remaining positions in his commodity pools and that he could only offer managed accounts to very few clients.
He flaunted his purported massive bank balance with over $11 million dollars as of June 2018.
Ramirez sold his targets access to his trading software for amounts ranging from $250 per month to over $25,000 for personalized trading advice and "premium" trading signals. He used the sense of urgency to convince his victims to invest quickly in his schemes or risk losing out on potential million-dollar gains.
This was a perfect example of a fraudster preying on investors fear of missing out commonly known as FOMO to persuade unsuspecting investors to part with their
The amounts involved
Ramirez solicited over $735,000 from more than 400 clients using the fraudulent scheme described above.
The US District Court for the Southern District of Texas ordered Ramirez to pay $735,983.48 to the clients he defrauded as restitution and asked him to pay over $2.2 million as a civil monetary penalty.
The CFTC explained that the charges brought against Ramirez were an indicator of its commitment to root out all types of fraud being perpetrated by unscrupulous individuals operating within its jurisdiction. The regulator said that it would not relent in its quest to protect Americans from fraudulent schemes that seek to exploit the investing public regardless of whether such schemes are conducted via new avenues such as social media.
The regulator warned to conduct the necessary due diligence regarding investment solicitations received via social media given that more and more fraudsters are using social media platforms to lure unsuspecting investors.
Fake traders on Instagram
According to the charges filed by the CFTC, Kelvin Ramirez lured his clients with promises of quick returns and a lavish lifestyle portrayed via social media posts.
Social media is the next frontier for Forex scammers who prey on people’s desire for a better life through photos that portray their awesome lives with profits they claim to have made from the Forex market.
While there are some legitimate millionaire traders who live the dream life that attracts most people to trade the financial markets, majority of those who are aggressively marketing their Forex account management services on social media have to do so because they are not making any money in the markets.
It does not take a lot of experience to teach people how to trade the Forex markets, it takes a lot of skill, dedication, and discipline to become a millionaire trader given that trading is a
Given that becoming a successful trader is a skill that you have to build over time, it’s only fair to imagine that there are not many basketball players who have the same skill as LeBron James, which is why there are not many millionaire traders out there.
Forex scammers have discovered the power of social media in finding easy targets for their fraudulent schemes given that many people make decisions based on their emotions. It is very easy to convince a potential target by taking photos driving expensive exotic cars such as Lamborghini’s, Ferraris, Maserati’s, and Rolls Royce among other super cars.
The most sophisticated scammers typically rent out these cars and expensive mansions, which they then convince potential targets that they have bought with the money they made from trading.
Many people are impressed and convinced that the fraudsters' claims are legitimate given that they appear to be living a rich life on Instagram, Facebook, Twitter, and other social media sites.
However, not all that glitters is gold and be wary of people who flaunt their lavish lifestyles on social media as in many cases, they are working hard to portray a certain image because they are not actually rich.
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