Ponzi Scam The Traders Domain Raises Over $283 Million and Sued by CFTC

On October 5, the U.S. Commodity Futures Trading Commission (CFTC) accused several companies and individuals of using a Ponzi scheme to defraud more than $283 million from more than 2,000 victims.

According to the regulator, from November 2019 to the present, The Traders Domain, Inc. along with two individuals, Fredirick Teddy Joseph Safranko and David William Negus-Romvari, orchestrated a Ponzi scheme that utilized leveraged or margined retail commodities trading and other types of commodities trading to to attract investments, particularly in gold-to-U.S. dollar pairs (XAU/USD).

They made false promises to clients, orally and in writing, omitted important information, and misappropriated client funds; The Traders Domain and Safranko even falsified trading records.

The Traders Domain, which later became Trubluefx, continued to run the scam.

Due to the misappropriation of client funds, thousands of victims failed to withdraw after repeated attempts to access or liquidate their accounts. This has been the case since the fall of 2022. At that time, several clients noticed that the company was delaying withdrawals and even failed to withdraw. However, the suspects responded to this situation by fabricating numerous contradictory excuses, falsely claiming that the clients' funds were safe and promising to refund as soon as possible.

In the meantime, they did not stop soliciting new clients. They used the funds from the new clients to extend the scam for over six more months, defrauding them of millions of dollars.

In 2022, the CFTC added The Traders Domain to its warning list, “RED List”.

The CFTC said the scam surrounding The Traders Domain, Safranko and Negus-Romvari reached multiple individuals and entities. Other entities and individuals, also charged, were controlled by them to help create the illusion of legitimate trading and solicit clients.

A number of agencies in the financial industry, including the National Futures Association (NFA), the Ontario Securities Commission (OSC), the St. Vincent and the Grenadines Financial Services Authority (SVG FSA), and the Vanuatu Financial Services Commission (VFSC), assisted in the CFTC's lawsuit.

In August 2023, BrokersView listed The Traders Domain as a scam and listed multiple regulatory warnings against this company, alerting investors to the risk of fraud.