CFTC plans to amend complaint against fraudulent investment scheme Bluprint LLC
The Commodity Futures Trading Commission (CFTC) is seeking to amend its complaint in the case targeting fraudulent investment scheme Bluprint LLC and its director Rajiv Patel. This is made clear by documents filed by the regulator in the Florida Southern District Court.
The CFTC explains that the parties have learned additional facts concerning the scope of the fraud at issue and the role of certain third parties. The CFTC anticipates joining at least one party, but requires a second short extension to determine the appropriate factual allegations and obtain internal approval to amend the complaint.
The CFTC complaint alleges that, between at least June 2019 and continuing through the present, Patel and his company, Bluprint LLC, have engaged in a fraudulent scheme to solicit and misappropriate money invested with them for the purported purpose of trading commodity futures and securities in a commodity pool.
The defendants allegedly solicited and/or accepted at least $9.8 million from at least sixteen individuals and entities to trade commodity futures and securities in a commodity pool. Instead of using Pool Participant funds to trade on behalf of the Bluprint Pool, the defendants immediately misappropriated the funds.
The defendants misappropriated Pool Participant funds by directing or depositing the funds into Patel’s personal bank and trading accounts. Patel used Pool Participant funds to support his lifestyle, including by making mortgage payments for two homes in Palm Beach County, Florida; making loan payments on several vehicles; and by making regular payments to credit card providers and personal loan financers.
Patel also used Pool Participant funds to personally trade, among other things, commodity futures and options. Patel’s trading has been overall unprofitable and caused significant losses of Pool Participant funds. Meanwhile, Patel reported to Pool Participants that their investments were earning interest, when in reality, as of November 21, 2021, the investments were depleted and earning no interest.
The CFTC alleges that the defendants have violated certain anti-fraud, commodity pool registration, and related provisions of the Commodity Exchange Act (“Act” or “CEA”), 7 U.S.C. §§ 1-26, namely, Sections 4b(a)(1)(A)-(C), 4c(b), 4k(2), 4m(1), 4o(1)(A)-(B) of the Act, 7 U.S.C. §§ 6b(a)(1)(A)-(C), 6c(b), 6k(2), 6m(1), 6o(1)(A)-(B), and CFTC Regulations (“Regulations”) 4.20(a)(1), (b), and (c), 4.21, 4.22, and 32.4, 17 C.F.R. §§ 4.20(a)(1), (b), and (c), 4.21, 4.22, 32.4 (2021).
The CFTC seeks civil monetary penalties and remedial ancillary relief, including but not limited to, trading and registration bans, restitution, disgorgement from defendants, rescission, as well as pre- and post-judgment interest.