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Florida Man Gets 17 Years For Currency Trading Fraud Scheme

Florida Man Gets 17 Years For Currency Trading Fraud Scheme

A Florida man was sentenced Tuesday in Miami to more than 17 years in federal prison for duping about 300 investors out of millions of dollars through a phony currency trading firm before cashing out and fleeing to Panama.

U.S. District Judge Patricia A. Seitz ordered Michael John Alcocer Roa, 34, of Kissimmee, Florida, to serve 210 months in prison, followed by three years of supervised release. A federal jury convicted Alcocer of five counts of wire fraud following a trial in April over the operation of his company Inovatrade Inc., which he set up in 2008 and ran until 2011, according to court records.

At trial, prosecutors presented testimony and evidence showing that Alcocer told people they could set up accounts with Inovatrade to use for trading foreign currencies. He also gave customers the option to set up managed accounts in which he and others at Inovatrade would trade foreign currencies on their behalf, or to invest in guaranteed investments that would return about 15 percent per year or more.

He told clients that the company maintained their money in separate, safeguarded accounts, prosecutors said.

Based on these assurances, Alcocer took in more than $7 million from more than 300 individuals and entities, according to prosecutors. Many were provided with statements purporting to show their account balances and monthly interest or other gains, but when they requested withdrawals, many were unable to get their money from him.

Financial records of banking accounts held by Inovatrade and Alcocer revealed that very little if any actual trading took place in the Inovatrade accounts, prosecutors said. Alcocer lacked the license to conduct foreign currency trading on the forex market on behalf of others, as required by the Commodity Exchange Act, according to the original complaint, which was filed in September 2015.

In the complaint, prosecutors claimed that Alcocer brought in more than $3 million between January 2011 and March 2011, while paying out only about $419,000, and during that same period, he transferred nearly $2.2 million from Inovatrade’s U.S. bank account to bank accounts in Panama.

He closed out the Inovatrade bank accounts in March 2011, cashing out about $450,000, and left for Panama in July of that year. According to government records, he did not reenter the United States until taking a flight to Puerto Rico in August 2015.

In total, Alcocer raised more than $8.1 million in Inovatrade accounts between October 2008 and March 2011, of which about $7.2 million was investor money and was never segregated into separate client accounts, prosecutors claimed. Of that amount, he transferred more than $3.1 million to bank accounts in Panama; withdrew about $670,000 in cash; and spent approximately $220,000 on gold, jewelry and watches, and $52,069 in car payments, according to the complaint.

Judge Seitz has set a separate restitution hearing for Dec. 13.

In addition to the instant criminal suit, in January 2011, Inovatrade was one of 14 companies sued by the U.S. Commodity Futures Trading Commission in separate suits that alleged they illegally solicited or accepted orders from U.S. investors to enter into foreign currency transactions.

A default judgment was entered against Alcocer and Inovatrade in April 2013 in that action.

Alcocer’s counsel did not immediately respond to a request for comment late Wednesday.

The United States is represented by John Gonsoulin and Vanessa Sisti Snyder of the U.S. Attorney’s Office for the Southern District of Florida.

Alocer is represented by Orlando do Campo of do Campo & Thornton PA.

The case is USA v. Alcocer Roa, case number 1:15-cr-20709, in the U.S. District Court for the Southern District of Florida.

Source: Law360.com