Shipkevich Bitcoin and ICO Attorney
Felix Shipkevich November 16, 2011

The CFTC has filed a civil injunctive complaint against Nicholas Trimble and his companies, Capstone FX Quantitative Analysis, Inc, and Beekeepers Fund Capital Management, LLC. The Denver-based defendants have been charged with fraudulently soliciting over a million dollars from customers to trade foreign exchange (forex) in pooled and managed trading accounts via their proprietary trading system. A U.S. District Judge has entered an order freezing the defendants’ assets, prohibited the destruction of their books and records, and given the Commission access to said documents.

According to the CFTC, from June 2009 to the present Trimble, Capstone, and Beekeepers solicited the public to trade forex using Trimble’s own trading system. He claimed this so-called “Gladiator system,” was fully programmable, and relied on a forex robot trading system created by an ex-NASA engineer. The defendants also represented to customers that they actively managed over $5 million in various forex trading accounts, and stated that the trading system had steadily returned 3% monthly profits for the past four year. These claims were false. The Commission argues that neither of Trimble’s companies even managed any forex accounts, let alone possessed a NASA-engineered trading system.

The complaint also alleges that Trimble told prospective customers that Capstone had received and turned down an offer of $20 million to buy the “Gladiator system.” Trimble said that Capstone instead was funded by a reputable trading firm, who had pledged $5 million in light of the forex trading system’s proven success. In this manner, the defendants were able to solicit $1.1 million. Instead of trading those funds, Trimble, Capstone, and Beekeepers misappropriated $441,000. Trimble used the money to gamble in Las Vegas and to pay personal expenses.

The CFTC is seeking the return of ill-gotten gains, restitution to defrauded customers, civil monetary penalties, trading and registration bans, and permanent injunctions against further violations of the federal commodities laws.

Read more about this CFTC enforcement action.
Creative Commons License photo credit: hans s

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