The former CEO of Millennium Capital Exchange
has pleaded guilty to running a foreign exchange market Ponzi scheme. Federal prosecutors
say that Maxwell incorporated and owned Millennium, an investment firm
that claimed to deal in the forex/foreign exchange market.
According to court documents, from 2008 to January 2012, Maxwell allegedly
lured individuals throughout the United States to invest in forex trading,
promising high fixed rates of return. The indictment accused Maxwell of
making multiple false statements in order to secure these investments,
- Claiming that he was an experienced and successful forex trader
- Promising returns from 48% to 72% annually
- Stating that his trading strategies would produce large gains and keep
losses to a minimum
- Claiming he had backup money that could cover the cost of any losses investors sustained
According to the U.S. Attorney’s Office for the Northern District
of Georgia, exactly the opposite was true. They claimed that Maxwell was
actually very inexperienced in forex trading, lost most of the money he
had invested in forex markets, and did not have any money with which to
pay back investors.
Prosecutors say that Maxwell led investors to believe that their money
would be handled through accounts in Switzerland. Instead, Maxwell allegedly
diverted about half of his customers’ money for his own personal
use as well as to pay back earlier investors.
Maxwell was indicted in March of this year and pleaded guilty this week.
His sentencing is scheduled for September 2, 2015.