Texas Federal Court Issues Order Freezing Assets of Mark Rice and His Houston Company, Financial Robotics
CFTC charges the defendants with forex solicitation fraud. Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced that a federal court in Houston entered an order freezing the assets of Mark E. Rice of Sugar Land, Texas, and his company, Financial Robotics, Inc. (FinRob) of Houston, Texas. The order, entered by Judge Lee H. Rosenthal, also prohibits the destruction of books and records and appoints a temporary receiver. The judge ordered Rice and FinRob to appear in court on July 28, 2011 for a preliminary injunction hearing.
The order arises out of a CFTC civil complaint filed under seal on June 29, 2011 in the U.S. District Court for the Southern District of Texas. The complaint charges Rice and FinRob with fraudulently soliciting millions of dollars from at least one individual to trade off-exchange foreign currency (forex) through accounts that they managed. In their solicitations, the defendants allegedly falsely claimed that their investments were insured against loss. The defendants also falsely guaranteed the return of the principal amount invested, according to the complaint.
In its continuing litigation against the defendants, the CFTC seeks restitution, disgorgement of ill-gotten gains, a civil monetary penalty, and a permanent injunction against further violations of the federal commodities laws.
The CFTC thanks the National Futures Association, the British Virgin Islands Financial Services Commission, and the United Kingdom’s Financial Services Commission.
The Division of Enforcement staff members responsible for this case are Kevin S. Webb, Michelle S. Bougas, Heather Johnson, James H. Holl, III, Gretchen L. Lowe, and Vince McGonagle.
Federal Court in Texas Orders $1.5 Million in Sanctions against Defendant Mark E. Rice for Fraudulent Forex Scheme
Washington, DC — The U.S. Commodity Futures Trading Commission (CFTC) obtained a federal court Order requiring Defendant Mark E. Rice, of Sugar Land, Texas, to pay $827,000 in restitution and a $673,000 civil monetary penalty to settle CFTC charges related to fraudulent solicitation and misappropriation of customer funds to trade leveraged off-exchange foreign currency contracts (forex). The Consent Order of Permanent Injunction, entered on January 13, 2014, by Judge Lee H. Rosenthal of the U.S. District Court for the Southern District of Texas, also imposes permanent trading and registration bans against Rice and prohibits him from violating provisions of the Commodity Exchange Act, as charged.
The Consent Order stems from a CFTC Complaint filed on June 29, 2011, against Rice and Rice’s company, Financial Robotics, Inc. (see CFTC Press Release 6067-11).
The Order finds that, from June 2008, Rice operated a fraudulent scheme that solicited approximately $1.7 million from one individual to trade leveraged off-exchange forex contracts. According to the Order, Rice falsely told his customer, among other things, that his investment was “risk free” and insured against loss and that the return of his principal was guaranteed. The Order further finds that Rice misappropriated at least $576,000 of his customer’s funds by transferring the money to unrelated Rice-controlled companies and, thereafter, spending at least $404,000 of those funds for Rice’s personal and business expenses.
The CFTC’s litigation continues against Financial Robotics, Inc.
The CFTC thanks the National Futures Association, the British Virgin Islands Financial Services Commission, The Netherlands Authority for the Financial Markets, and the United Kingdom’s Financial Conduct Authority for their assistance.
CFTC Division of Enforcement staff members responsible for this case are Kevin S. Webb, Michelle S. Bougas, James H. Holl, III, and Gretchen L. Lowe.
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