Court grants entry of default against binary options fraudster Yossi Herzog
More than a year has passed since the United States Commodity Futures Trading Commission (CFTC) took a number of individuals and business entities linked to Yukom Communications to court over a large-scale binary options scam. The legal proceedings continue at the Illinois Northern District Court, with the latest hearing resulting in the Court’s approval of a CFTC’s motion for entry of default against some of the defendants – Yossi Herzog, Shalom Peretz and Yukom Communications.
The Honorable Andrea R. Wood said that CFTC’s renewed motion for entry of default as to Herzog, Peretz, and Yukom is granted. The reason for the granting of the motion is that these three defendants have failed to appear, plead or otherwise defend within the time allowed, and, therefore, are now in default.
The next step, as one might expect, would be for the CFTC to push for a default judgment against these defendants. The default judgment typically includes specifications regarding monetary penalties and restitution.
One of the reasons for the delays in this case is that many of the defendants cannot be located and served via traditional means.
Yukom Communications Ltd. has been incorporated in Israel since at least 2013.
Yossi Herzog is an Israeli citizen who, upon information and belief, resides in Zichron, Israel. Herzog has owned, operated, and controlled each entity comprising the Yukom Enterprise, and operated them as a common enterprise in connection with the Yukom Enterprise’s websites. Herzog, acting alone or in concert with others, has formulated, directed, controlled, had the authority to control, and/or participated in the acts and practices of the Yukom Enterprise. Herzog has never been registered with the Commission in any capacity.
According to the CFTC complaint, Shalom Peretz is an Israeli citizen who currently resides in Israel. The regulator alleges that Peretz has had an ownership interest in Wirestech, WSB, and Zolarex at various times. Also, since at least September 10, 2015, Peretz has been the director, officer, and beneficial owner of Zolarex. Since at least August 24, 2015, Peretz has been the director of Wirestech and has been the nominee owner of Wirestech. Further, Peretz has been the director, officer, shareholder, and/or nominee owner of certain other entities that have received, held, or transferred funds on behalf of the Yukom Enterprise. Peretz has never been registered with the CFTC in any capacity.
The fraudulent scheme involved a global retail binary options enterprise that targeted and victimized US residents. As alleged in the complaint, the defendants executed their unlawful scheme through internet websites using fictitious trade names such as BigOption, BinaryBook, and BinaryOnline.
Lee Elbaz, the former CEO of Yukom, is currently appealing from her sentence in related criminal proceedings.