US charges 47 forex traders after FBI sweep

FBI’s Price Catch – Forex traders help

It is quite sometime that though the reports were pouring on Fraudulent Forex Trading, there was not much action or reaction seen from either the trading market or from US government detectives. It is quite surprising to see that FBI though working quietly came out with 47 traders. It was a shocking news for the entire market as well as to the trading community.
 
Criminal charges were announced against 47 traders after FBI agents swooped down on Wall Street and other locations in a crackdown on allegedly crooked foreign exchange dealers.

Raids were carried out Tuesday and Wednesday in which FBI agents hauled off traders in handcuffs, after an 18-month undercover investigation dubbed "operation wooden nickel," US Attorney James Comey said. The arrests were made in the financial district of New York; Jersey City, New Jersey; and Stamford, Connecticut, officials said.

The sweep netted traders at some of the world's biggest financial institutions as well as so-called "boiler-room" dealers who preyed on small investors. One of the schemes was alleged to have defrauded more than 1,000 individual investors of tens of millions of dollars.

A second scheme involved corrupt brokers who took kickbacks to defraud their own employers to make money-losing trades, Comey said at a news conference. This second scheme involved currency traders at JP Morgan Chase; Societe Generale of France; UBS Warburg Dillon Reade, an arm of Swiss-based.

FBI cautions investors and trading community

FBI through this price catch warns the entire trading and financial community to deal with these group of  brokers in a very cautious manner. It is mandatory though for the FBI to produce these traders to the court prior to proving charges against them none the less it is very difficult for them to renew their trading licenses in the near future.

FBI still investigating further for  clues if any on the other financial sectors and trading activities. FBI is yet to ascertain the amount involved in to these fraudulent transactions by these Forex Traders. Nonetheless, this operation indeed an eye opener and has put an alarm to those still continuing with these kind of trading activities.