Detroit-Area Man Charged in Investment Scam
According to the U.S. Commodity Futures Trading Commission (CFTC), a Clinton Township man and a Pennsylvania man were charged in an alleged investment scam involving more than $45 million. The investment scam reportedly involved about 600 individuals and entities.
The CFTC, in conjunction with the Michigan Office of Financial and Insurance Regulation, reports that Alan Watson, of Clinton Township, and Michael Potts, of Mountville, PA, solicited more than $45 million for a commodity pool to trade future contracts and securities. Mr. Watson is with Clinton Township-based Cash Flow Financial LLC (CFF).
The CFTC has reported that the men were not registered with the CFTC. The CFTC alleges that Mr. Watson and Mr. Potts never used the money for trading. The organization claims that the two men used the funds for their personal profit.
Investors were under the impression that their money was being traded by the Florida-based “investment club,” Trade LLC. The CFTC alleges that only $8.1 million was traded by Trade LLC. Trade LLC is under a separate investigation involving illegal trading.
The CFTC has accused Mr. Watson of covering up trading losses and misappropriation with false statements and reports.
The CFTC has reported that they are still searching for the money invested in CFF. They are seeking restitution and a return of ill-gotten gains, along with other penalties.