The Commodity Futures Trading Commission (CFTC) anticipates seeking additional evidence in its lawsuit against individuals and entities linked to Yukom Communications. This becomes clear from a status report filed by the regulator in the Illinois Northern District Court on April 25, 2022.

The document, seen by FX News Group, explains that the parties in this case do not request lifting of the stay.

The criminal case against Yakov Cohen remains pending. Cohen is not represented in the criminal action and his undersigned counsel in this matter represents that, to the best of his knowledge, Cohen remains outside of the United States.

On October 27, 2021, this Court granted defendant Cohen’s Unopposed Motion to Stay and entered an order staying this case and holding Cohen’s obligation to file an answer in abeyance while the case is stayed.

The Court has entered default pursuant to Fed. R. Civ. P. 55(a) as to all eight of remaining defendants. Specifically, default has been entered against five entities: Yukom Communications Ltd, Linkopia Mauritius Ltd., Wirestech Limited, WSB Investment Limited, and Zolarex Ltd. ; and three individuals: Yossi Herzog, Lee Elbaz, and Shalom Peretz. The Commission has not yet sought default judgment under Fed. R. Civ. P. 55(b) against the Defaulted Defendants.

The CFTC’s Complaint for Injunctive Relief, Civil Monetary Penalties, and Other Equitable Relief charges Cohen and the Defaulted Defendants with acting in concert in operating an illegal and fraudulent binary options trading scheme, and further alleges that Cohen, along with defaulted defendant Herzog, ultimately owned and controlled the Yukom Entities and masterminded the scheme.

The Complaint alleges that all defendants (i.e. Cohen and the Defaulted Defendants) are jointly and severally liable for the charged violations and seeks an order requiring defendants, as well as any successors thereof, to make full restitution to every person who has sustained losses proximately caused by the violations and to disgorge all benefits received in connection with the charged violations, among other relief.

The Commission anticipates seeking findings of liability concurrently with, or shortly following, any determination as to Cohen’s liability for the same charged conduct. The Commission also anticipates seeking additional evidence through discovery in this action that will further support the charged violations, identify additional benefits received by Cohen and the Defaulted Defendants, and/or identify additional sources of funds that should be used for restitution.

The CFTC has not yet placed evidence before the Court concerning the appropriate amount of disgorgement, restitution, or other monetary penalty. Following the determination of liability as to all defendants, the Commission anticipates seeking an appropriate order imposing monetary and equitable relief.

There are no updates in the criminal cases that impact the status of the Defaulted Defendants. On December 19, 2019, defendant Lee Elbaz, the CEO of Yukom, was sentenced to a term of imprisonment of 264 months and she remains a federal prisoner at the Federal Correctional Institution Dublin in Dublin, California.

To the best of counsels’ knowledge, defendant Herzog remains outside of the United States.