Texas Securities Commissioner Travis J. Iles on April 17 entered an emergency action to stop a supposed foreign currency trader from soliciting Texas residents with the claim they can “profit off the coronavirus with forex.”
According to the Emergency Cease and Desist Order, Georgia resident Kenzley Ramos is advertising investments in a forex trading program in the financial services section of craigslist.org sites for Austin, Dallas, Houston, and San Antonio.
Ramos’ most recent Craigslist ad claims “the stock market is crumbling,” according to the order.
Ramos, who lives in the Atlanta suburb of Lawrenceville, is soliciting investments of $200 to $2,000 to trade forex and binary options. According to the order, Ramos is promising to generate weekly returns of 300% and will collect a 15% fee on the balance whenever investors withdraw their funds. Ramos is guaranteeing the payment of returns, according to the order, saying there is “[n]o possible way [investors] can lose money.”
People who invested with Ramos have lost money, according to the order. In December 2019, one investor sent $1,000 to a bank account owned by Kenzley Ramos, giving it a balance of $1,035.
Two days later, Ramos withdrew $1,020 in cash from the account. According to the order, Ramos stopped communicating with the investor, never paid the promised profits on the account, and never returned the $1,000 principal deposit.
Ramos is violating the Texas Securities Act by offering securities without being registered as a dealer or agent. The investments in the forex and binary option trading program aren’t registered for sale in Texas.
Ramos isn’t the only name he uses. According to the order, Ramos is misleading investors with the use of at least two aliases – Anthony David “Tony” Mckinney and Anthony Green.
Although prior investors are complaining in several widely used online consumer protection forums, Ramos is dismissing these complaints. According to the order, he is falsely claiming the complaints were published by his competitors to attack his business. State securities regulators have repeatedly warned about the complexity and risks in currency trading and in https://www.nasaa.org/43192/informed-investor-advisory-binary-options/ investing.
Besides not telling potential investors he hasn’t delivered profits to previous investors, Ramos is not disclosing the long list of inherent risks in forex and binary option trading.
Foreign exchange investing involves the trading of currencies of other nations. Earning profits requires executing forex contracts in the currencies of dozens of countries with different political systems and economies.
Currency traders must be registered with one or more federal regulatory agencies and in most cases licensed with the Texas State Securities Board to sell investments based on forex trading.
When an investor purchases a binary option contract, the investor predicts the value of an underlying asset – such as a stock or currency – at a predetermined time or date in the future.
If the investor correctly predicts the asset price at the end of the contract, which can be just a matter of minutes, the investor receives the payout agreed upon in the contract. If the investor is incorrect, the amount of the investment is lost.
Binary option platforms are also thinly regulated and the lack of regulation can affect the ability to securely trade the investments.