Eddy Alexandre, owner and operator of EminiFX, failed to get the CFTC case against him and his company dismissed.
The relevant order was signed by Judge Valerie E. Caproni of the Southern District Court of New York on July 10, 2024.
This case arises out of Eddy Alexandre’s extensive fraud against investors in EminiFX, Inc., an entity owned and operated by Mr. Alexandre that purportedly deals in Forex and cryptocurrencies.
In a criminal prosecution brought against Mr. Alexandre, he pleaded guilty to the same fraudulent conduct alleged by the Plaintiff Commodity Futures Trading Commission (CFTC). Mr. Alexandre, proceeding pro se, moved to dismiss the CFTC’s complaint, compel arbitration, or stay the case. The CFTC opposed the proposal.
Eddy Alexandre owned and operated EminiFX between September 2021 and May 2022. Although Mr. Alexandre guaranteed investors that they would receive a return of at least 5% per week, he lost almost 70% of the funds he traded.
None of the funds traded were used for forex or cryptocurrency trading, however, despite its claims to the contrary. Non-traded funds were retained and channeled by the defendants, including extravagant purchases such as BMW and Mercedes Benz cars and luxury clothing.
Of the approximately $59 million raised from investors, Mr. Alexandre funneled at least $14.7 million directly into his personal account.
Instead of disclosing all of this to his investors, however, Mr. Alexander falsely increased the account balances reported to investors by approximately 5% to 10% each Friday so that the accounts appeared to be increasing by reflecting balances that were not accurate. In short, Mr. Alexander ran a Ponzi scheme with disastrous results.
The CFTC initiated this case on May 11, 2022, alleging various violations of the Commodity Exchange Act (CEA). The CFTC alleged that the Defendants engaged in fraud in connection with the sale of commodity futures contracts and foreign exchange transactions, that the Defendants used manipulative devices in furtherance of the fraud, that EminiFX failed to register as a Commodity Pool Operator (CPO), and that the Alexandre failed to register as an Associated Person (AP) of a CPO.
The next day, Mr. Alexandros was arrested.
On April 4, 2024, Mr. Alexandre moved to dismiss the complaint, compel arbitration and stay the case, and the CFTC opposed the motion on April 22, 2024.
Mr. Alexandre moves to dismiss the Complaint for lack of subject matter jurisdiction, failure to state a claim, and for gross abuse of authority and bad faith. The Court found that none of these arguments justified the dismissal of the complaint.
For example, the Court noted that there is no tendency to enjoin arbitration in the absence of an agreement to arbitrate. because there is no written, enforceable arbitration agreement in this case, there is no reason to compel arbitration.
Since Mr. Alexandre does not present good reasons why the Court can stay the case, his request to stay the proceedings is denied.