The U.S. Commodity Futures Trading Commission (CFTC) announced that the U.S. District Court for the Southern District of Florida issued a consent order on March 20 to impose a permanent injunction, civil fines, compensation and equitable relief on Florida resident Joseph Carvajales.。

The order requires Carvajales to pay $2.4 million in restitution and $1 million in civil penalties to defrauded customers.。The order also imposes a permanent trading and registration ban on the defendant and a permanent injunction prohibiting the defendant from further violating the provisions of the Commodity Exchange Act (CEA) and the CFTC.。

The order found that, among other things, Carvajales, who was an employee of W Group (WTG), knowingly or recklessly made a large number of false statements to WTG customers and potential customers relating to futures, retail foreign exchange and options.。The order resolves the case filed by the CFTC on February 7, 2022.。

The order found that from June 2013 to June 2020, Carvajales, among other things, lied to WTG's potential customers about where WTG was trading; that WTG would use commodity trading algorithms to trade futures, foreign exchange and / or options on behalf of customers; opened personal trading accounts, deposited customer funds into trading accounts, and traded; and the profits and trading risks that may be obtained。In fact, the personal trading account was never opened, client funds were not deposited into the trading account, and no transactions were made。

Earlier, the U.S. District Court for the Southern District of Florida issued an in-absentia trial order against co-defendants WTG and Larry Ramos Mendoza (Ramos) of Miami, Florida.。The order found that WTG and Ramos embezzled more than $24 million from at least 220 customers, fraudulently solicited customers, and sent them false account statements showing alleged profits and trading activity that did not actually exist.。

The order requires WTG and Ramos to pay $7,482,680 in restitution and $22,448,040 in civil penalties.。The order also provides for permanent trading and registration bans, as well as permanent injunctions prohibiting defendants from further violations of CEA and CFTC regulations.。

The CFTC cautioned that restitution orders may not always recover lost funds because wrongdoers may not have sufficient funds or assets.。