Daniel Winston LaMarco, a resident of Long Island, New York, is being sued by the CFTC, according to recent reports. The man is already serving a three-and-a-half-year stint in prison for commodities fraud and wire fraud. LaMarco is being convicted due to his losing $862,000 in investor funds last year.
LaMarco broke contact with investors after the fraudulent activity, leading to the three-year sentence.
The CFTC is suing him due o his role in a $1.5 million fraud and because he hid losses and spending while stealing from investors. The CFTC filed a civil suit against LaMarco and his company, GDLogix, Inc., in connection to forex and commodity fraud.
Most noteworthy, he also failed to register with the CFTC as required by law.
The lawsuit claims that LaMarco accepted and solicited some $1,492, 650 from clients between January 2011 and March 2016. The funds came from just 13 individuals. The lawsuit claims that LaMarco solicited clients by word-of-mouth, email and other means.
He is also being accused of falsely representing himself by claiming that his success was a result of his own investments in forex trading. The complaint alleges that the entirety of the story is false.
LaMarco allegedly solicited pool participants, mostly friends and people he knew, who were located in New York, Ohio, Connecticut and Massachusetts. Monthly statements were sent to investors beginning in February 2011 that showed fabricated profits, losses and balances for each pool member.
CFTC officials state that LaMarco used the funds to fuel his lifestyle and spent the funds on personal expenses.
A statement from February 2016 showed that the pool fund had increased to $1,797,126, which was a misrepresentation. The funds had been lost through unsuccessful trades by LaMarco. A total of $630,050 being diverted to participants of the pool as “profits.”
James McDonald, Director of CFTC’s Division of Enforcement, stated: “This case is another example of a fraudulent investment scheme based on personal relationships. LaMarco targeted those with whom he made connections through his local community.”
CTFC officials are seeking full restitution for the victims defrauded in the Ponzi scheme. The funds, which date back as far as 2011, are not able to be returned as a chargeback, with no word on how the funds were given to LaMarco by members.
The U.S. Attorney’s Office for the Eastern District of New York assisted the CFTC in the matter.
LaMarco has been telling investors that forex was a safe investment with guaranteed, steady returns. Victims sought higher returns on their savings rather than what they are getting in traditional savings accounts.
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