The Ontario Capital Markets Tribunal is set to convene next week to deliberate on the potential extension of a temporary order against the operators implicated in an alleged Ponzi scheme exceeding US$300 million.
Scheduled for September 13, the hearing will address an application submitted by the Ontario Securities Commission (OSC) to extend a cease trade order issued on August 29 against Traders Global Group Inc. and its principal, Muhammad Murtuza Kazmi. The OSC has leveled accusations against them, asserting that they violated securities regulations by defrauding investors and engaging in trading activities without proper registration or a prospectus.
It’s essential to emphasize that these allegations have yet to be substantiated.
As detailed in regulatory documents, the OSC initiated an investigation into the activities of Ontario-based TGG and Kazmi following a request from the U.S. Commodities Futures Trading Commission (CFTC). The CFTC’s findings indicated that TGG operated a website, myforexfunds.com, which purported to be a retail foreign exchange and commodities trading firm.
The OSC’s application states, “There is virtually no real trading taking place at TGG. For the vast majority of investors, trading is simulated by TGG with various rules in place designed to benefit TGG to the detriment of investors.”
Regulators assert that the alleged scheme managed to amass approximately US$300 million from investors worldwide, funds that were purportedly used “to pay simulated ‘profits’ to other investors and for Kazmi’s personal expenses.”
In a separate legal development, the CFTC filed a complaint in the U.S. District Court for New Jersey against Muhammad Murtuza Kazmi, TGG, and a related U.S. company, Traders Global Group Inc. The complaint alleges that they engaged in “fraudulently soliciting customers to trade leveraged, margined, or financed retail foreign exchange (retail forex), and leveraged retail commodity transactions.”
It’s crucial to note that these allegations also remain unproven at this stage.
On August 29, a judge granted a statutory restraining order that froze the assets of the accused, appointed a temporary receiver, and mandated the defendants to provide their books and records to the CFTC. A hearing regarding the CFTC’s motion for a preliminary injunction is scheduled for September 11.
