The United States Commodity Futures Trading Commission (CFTC) appears to be making some progress in its action against Jared J. Davis, head of a $10 million fraudulent binary options scheme.

According to a status report filed by the regulator on December 15, 2021, at the Ohio Northern District Court, the parties in this lawsuit are discussing a settlement. The report, seen by FX News Group, says that on December 13, 2021, the parties engaged in preliminary settlement discussions and plan to have additional discussions in the coming weeks.

This is a bit of good news as the CFTC lawsuit against Davis commenced more than two years ago and has not brought any relief to victims of the fraudulent scheme yet.

Let’s recall that the CFTC filed its civil enforcement action against Jared J. Davis back in September 2019.

The CFTC complaint charges that from at least July 2012 through at least June 2016, Davis fraudulently solicited and accepted at least $10 million from customers in the United States and elsewhere to trade off-exchange binary options on commodities and Forex, among other things. As alleged in the complaint, Davis executed his unlawful scheme through internet marketing campaigns, various websites, and call centers using trade names such as Option Mint, Option King, and Option Queen.

The complaint further charges that Davis defrauded customers by making misrepresentations and omissions of material facts, including misrepresenting and failing to disclose that he effectively took the opposing position on each trade and therefore made money when customers lost money on trades. The complaint also alleges that Davis failed to inform customers that he frequently had the trading platforms manipulate the options trading software settings to increase the odds of customer losses.

In its continuing litigation, the CFTC seeks full restitution to defrauded investors, disgorgement of ill-gotten gains, civil monetary penalties, permanent registration and trading bans, and a permanent injunction against future violations of the Commodity Exchange Act and Commission Regulations.