The legal representatives of My Forex Funds and its CEO Murtaza Kazmi responded to all the allegations made by the Commodity Futures Trading Commission (CFTC) and categorically denied them.
According to the 41-page motion filed yesterday (Tuesday) in a US court, “the CFTC has no likelihood of succeeding in its allegations because MFF never solicited or accepted any investments from its customers or engaged in retail foreign exchange transactions or indeed any transactions with retail investors.”
The CFTC initially filed suit against two entities named Traders Global Group, one based in New Jersey and the other in Canada, operating as My Forex Funds, and Kazmi, who controls them as CEO. With multiple allegations, the gist of the regulatory lawsuit is that Traders Global is a fraudulent organization.
The defense denies all allegations
In a recent response, attorneys for My Forex Funds and Kazmi questioned the CFTC’s jurisdiction over the prop trading platform, stating that “transactions between MFF and its customers do not fall within the scope of the Commodity Exchange Act (CEA) anti-fraud. provisions, registration requirements and prohibitions on over-the-counter trading.’
“But even if these provisions were to apply, the CFTC’s claims lack factual support,” the defense motion added.
Murteza Kazmi, CEO of My Forex Funds
The court filing detailed My Forex Funds’ business model, noting that the platform “paid out tens of millions of dollars to customers in accordance with rules it established and agreed to by its customers.” He further pointed out that the CFTC did not produce evidence from a single customer of My Forex Funds in distress.
“Delivering exactly what one promises is not cheating; it’s a good deal,” the proposal read. “The CFTC cannot prove otherwise.
One of the primary defenses of my forex fund lawyers is that the customers have never invested their own funds. Company money was always used to fund all accounts. The customers agreed to “serve as independent contractors providing business services to MFF.” It further revealed that a significant portion of the trading activities took place on simulated accounts.
“To the extent that CFDs and foreign exchange contracts existed – and most of them were only simulated – MFFs were exclusively entered into using equity capital with CDO Markets,” the proposal said.
Additionally, the proposal emphasized that the CFTC must demonstrate misrepresentation, misleading statements, or deceptive omissions, science, and materiality to support a fraud claim. However, according to the defendants, the regulator failed to establish even one of them.
Removal of the preliminary injunction
Based on a previous court order, the CFTC was able to freeze the assets of My Forex Funds as well as Kazmi’s personal assets. The court additionally appointed a temporary receiver. However, according to the defendants’ lawyers, “the freezing of assets in the preliminary proceedings is an ‘extraordinary remedy’.”
“The court should deny the CFTC’s motion for preliminary injunction as unnecessary to preserve the assets of the defendants,” the motion said. “Even if the Court decides that some injunction is appropriate, that order should be limited to freezing any funds that are causally connected to the alleged wrongdoing such that they may be subject to disgorgement (which the defendants claim is non-existent) .
According to this argument, the amount of disgorgement should not exceed $10,370,878.10, which represents MFF’s gross profits received from defaulting live traders. In addition, the proposal pointed out that such traders account for a maximum of 6% of all MFF accounts over time.
In an earlier motion, the defense said the CFTC “recklessly mischaracterized transfers to and from the defendants’ bank accounts before the SRO [statutory restraining order] was entered.”
She further stressed that any injunction should only apply to the multi-year financial framework legal entities and not to Kazmi personally.
The legal representatives of My Forex Funds and its CEO Murtaza Kazmi responded to all the allegations made by the Commodity Futures Trading Commission (CFTC) and categorically denied them.
According to the 41-page motion filed yesterday (Tuesday) in a US court, “the CFTC has no likelihood of succeeding in its allegations because MFF never solicited or accepted any investments from its customers or engaged in retail foreign exchange transactions or indeed any transactions with retail investors.”
The CFTC initially filed suit against two entities named Traders Global Group, one based in New Jersey and the other in Canada, operating as My Forex Funds, and Kazmi, who controls them as CEO. With multiple allegations, the gist of the regulatory lawsuit is that Traders Global is a fraudulent organization.
The defense denies all allegations
In a recent response, attorneys for My Forex Funds and Kazmi questioned the CFTC’s jurisdiction over the prop trading platform, stating that “transactions between MFF and its customers do not fall within the scope of the Commodity Exchange Act (CEA) anti-fraud. provisions, registration requirements and prohibitions on over-the-counter trading.’
“But even if these provisions were to apply, the CFTC’s claims lack factual support,” the defense motion added.
Murteza Kazmi, CEO of My Forex Funds
The court filing detailed My Forex Funds’ business model, noting that the platform “paid out tens of millions of dollars to customers in accordance with rules it established and agreed to by its customers.” He further pointed out that the CFTC did not produce evidence from a single customer of My Forex Funds in distress.
“Delivering exactly what one promises is not cheating; it’s a good deal,” the proposal said. “The CFTC cannot prove otherwise.
One of the primary defenses of my forex fund lawyers is that the customers have never invested their own funds. Company money was always used to fund all accounts. The customers agreed to “serve as independent contractors providing business services to MFF.” It further revealed that a significant portion of the trading activities took place on simulated accounts.
“To the extent that CFDs and foreign exchange contracts existed – and most of them were only simulated – MFFs were exclusively entered into using equity capital with CDO Markets,” the proposal said.
Additionally, the proposal emphasized that the CFTC must demonstrate misrepresentation, misleading statements, or deceptive omissions, science, and materiality to support a fraud claim. However, according to the defendants, the regulator failed to establish even one of them.
Removal of the preliminary injunction
Based on a previous court order, the CFTC was able to freeze the assets of My Forex Funds as well as Kazmi’s personal assets. The court additionally appointed a temporary receiver. However, according to the defendants’ lawyers, “the freezing of assets in the preliminary proceedings is an ‘extraordinary remedy’.”
“The court should deny the CFTC’s motion for preliminary injunction as unnecessary to preserve the assets of the defendants,” the motion said. “Even if the Court decides that some injunction is appropriate, that order should be limited to freezing any funds that are causally connected to the alleged wrongdoing so that they may be subject to disgorgement (which the defendants claim is non-existent.”
According to this argument, the amount of disgorgement should not exceed $10,370,878.10, which represents MFF’s gross profits received from defaulting live traders. In addition, the proposal pointed out that such traders account for a maximum of 6% of all MFF accounts over time.
In an earlier motion, the defense said the CFTC “recklessly mischaracterized transfers to and from the defendants’ bank accounts before the SRO [statutory restraining order] was entered.”
She further stressed that any injunction should only apply to the multi-year financial framework legal entities and not to Kazmi personally.