| I’m constantly trying to warn naive (and sometimes | | | | solicited members of the Korean community of the |
| the most sophisticated) investors that people promising | | | | San Francisco Bay area, where defendants Son and |
| unthinkable returns but refusing to disclose all the | | | | Chung lived. Defendants falsely claimed to be |
| financial details are rip off artists. If you do not have | | | | successful forex traders, touting a purported track |
| a clear cut description/prospectus/term sheet of what | | | | record of 50 percent annual returns and guaranteeing |
| products are being invested in, where the assets are | | | | monthly returns of 2 percent to 3 percent. Solicitation |
| being held and who is monitoring the performance (like | | | | materials boasted that SNC was a leading forex firm |
| KPMG, E&Y, etc.) – chances are good that | | | | in the industry. |
| you have been approached by a scammer looking to | | | | Each month, defendants allegedly provided account |
| part you from your hard earned money. | | | | statements showing the promised steady returns, and |
| Transparency is key in the investment arena. | | | | they continued to solicit new funds. Over the last year |
| We already had a Texan Professor as well as | | | | of operation, defendants took in approximately $22 |
| a Florida money manager charged with running | | | | million in new funds with millions coming in shortly |
| a Ponzi scheme but this time the scam was more | | | | before they shut down. |
| targeted: it was used to rip off Korean-Americans. | | | | Defendants, however, appeared to have engaged in |
| Full release: | | | | little trading on behalf of customers. What little trading |
| CFTC Charges California-Based SNC Asset | | | | they actually did was unprofitable. Instead, defendants |
| Management, Inc., SNC Investments Inc., CEO Peter | | | | misappropriated funds to pay returns and principal to |
| Son, and CFO Jin K. Chung in an $85 Million Forex | | | | customers, to pay for personal expenses, including |
| Ponzi Scam | | | | mortgage payments on Son’s luxury home, to |
| Defendants Targeted Korean Community in the San | | | | funnel money to the relief defendant, and to meet the |
| Francisco Bay Area | | | | capitalization requirements of SNC Investments. |
| | | | The CFTC complaint also charges SNC Investments, a |
| Washington, DC –The U.S. Commodity Futures | | | | Futures Commission Merchant registered with the |
| Trading Commission (CFTC) today announced that it | | | | CFTC, with violating minimum net capital requirements |
| filed an action in federal court in San Francisco | | | | and withholding notice of its undercapitalization. |
| charging SNC Asset Management, Inc., (SNC Asset) | | | | Relief Defendant Ann Lee, the Wife of Peter Son, |
| and SNC Investments, Inc., (SNC Investments), both of | | | | Named |
| Pleasanton, California (collectively SNC), and Chief | | | | The CFTC complaint names Ann Lee as a relief |
| Executive Officer Peter Sonand Chief Financial | | | | defendant because she received monthly funds as |
| Officer Jin K. Chung, with operating an $85 million | | | | purported wages, although she performed no services |
| fraudulent foreign currency (forex) scam involving | | | | for SNC. Ann Lee is the wife of Son. |
| approximately 500 customers. The CFTC seeks an | | | | In addition to the emergency relief seeking to freeze |
| emergency restraining order freezing assets and | | | | assets, repatriate funds, preserve records and enjoin |
| preserving the records of the defendants | | | | the fraudulent activity, the CFTC seeks restitution, |
| The CFTC’s complaint, filed today, charges | | | | disgorgement, civil monetary penalties, and permanent |
| defendants with misappropriating customer funds to | | | | injunctions against further violations of the federal |
| pay off other customers and to pay personal and | | | | commodities laws and against further trading. |
| business expenses. The defendants are also charged | | | | Yesterday, Son appeared in federal court in Oakland, |
| with fraudulent solicitation and the issuance of false | | | | California on federal criminal charges. In a separate |
| statements to customers to conceal their | | | | action today, the U.S. Securities and Exchange |
| misappropriation and lack of trading. As alleged, | | | | Commission also filed charges against the defendants. |
| defendants abruptly closed operations, and Son and | | | | The CFTC’s Division of Enforcement thanks the |
| Chung disappeared. | | | | U.S. Securities and Exchange Commission, the Federal |
| Stephen J. Obie, Acting Director of the CFTC’s | | | | Bureau of Investigation, the U.S. Attorney’s Office |
| Division of Enforcement, commented: “This is yet | | | | for the Northern District of California, the National |
| another example of the insidious nature of fraudulent | | | | Futures Association, the Danish Financial Supervisory |
| investment schemes that target affinity groups. Based | | | | Authority (Finanstilsynet), and the Swedish Financial |
| on personal relationships, people were lured into parting | | | | Supervisory Authority (Finansinspektionen) for their |
| with their hard-earned money, only to learn, too late, | | | | assistance. |
| that they were the victims of a massive forex fraud. | | | | The following CFTC Division of Enforcement staff |
| The CFTC has been vigilant in taking quick action to | | | | members are responsible for this case: Gretchen L. |
| stop such schemes as soon as they are discovered | | | | Lowe, Luke Marsh, Toye Olarinde, Kara Mucha, and |
| and bring these fraudsters to justice.” | | | | Michelle Bougas. |
| Allegedly, since at least 2000, defendants fraudulently | | | | |