The Commodity Futures Trading Commission (CFTC), the regulatory agency for derivatives markets in the United States, recently announced that Judge Darrin P. Gayles of the Southern District Court of Florida issued a default judgment against four individuals and five companies (a total of nine defendants).

The defendants include Jase Davis of Brandon, Mississippi; Borys Konovalenko of Ukraine; Anna Shymko of Duluth, Georgia; Alla Skala of Long Island and/or Fort Erie, Canada; as well as Easy Com LLC d/b/a ROFX (a New Hampshire limited liability company), Global E-Advantages LLC a/k/a Kickmagic LLC d/b/a ROFX (a Delaware limited liability company and a New York foreign limited liability company), Grovee LLC d/b/a ROFX (a Delaware limited liability company), Notus LLC d/b/a ROFX (a dissolved Colorado limited liability company), and Shopostar LLC d/b/a ROFX (a Colorado limited liability company).

This default judgment stems from a complaint filed by the CFTC on August 31, 2022, accusing these nine defendants and another defendant, Timothy F. Stubbs, of fraud, misappropriation of funds, and registration violations in a forex fraud scheme.

According to the default judgment issued on April 22, 2024, the nine defendants are found liable for all alleged violations under the Commodity Exchange Act (CEA) and CFTC regulations, including fraudulent conduct involving forex trading, resulting in the misappropriation of over $57 million in customer funds. Pursuant to the judgment, the nine defendants are collectively required to pay over $56 million in restitution to defrauded customers and a civil monetary penalty of $169,086,837. Additionally, the judgment permanently prohibits them from engaging in any violations of the CEA, permanently bars them from registering with the CFTC, and prohibits them from trading on any CFTC-regulated market.

On May 8, the court also issued a supplemental consent order against another defendant, Timothy F. Stubbs. The consent order requires Stubbs to pay a civil monetary penalty of $314,000 and restitution of $153,000. Previously, on December 19, 2023, the court issued a preliminary consent order against Stubbs. The preliminary consent order found that Stubbs engaged in fraud through his control and operation of Grovee LLC, including the acceptance and misappropriation of customer funds for forex trading. The preliminary consent order imposed permanent injunctions on Stubbs as well as permanent trading, solicitation, and registration bans.

These default judgments and supplemental consent orders resolve the CFTC's litigation against all defendants.

ROFX Case Background

According to the default judgments and preliminary consent orders, the five companies, under the control of five individual defendants, fraudulently solicited and misappropriated at least $57.5 million in U.S. and international customer funds for purported forex trading through the ROFX.net website from January 2018 to September 2021. The defendants obtained customers through the ROFX website and falsely claimed to use highly successful automated trading robots for forex trading, guaranteeing to cover losses.

The judgments and consent orders also found that the defendants misappropriated all customer funds to offshore entities or individual accounts unrelated to forex trading.

Additionally, the judgments and consent orders found that these five companies conducted futures brokerage business under the name ROFX, solicited or accepted retail forex trading orders through the ROFX website, and accepted related trading funds without registering with the CFTC.