CFTC Sanctions IowaBased Broker With Commodity Trading Fraud

CFTC Sanctions IowaBased Broker With Commodity Trading Fraud

CEDAR RAPIDS, IA – Iowa-based Jeffrey J. Kinseth, and his company, Virtual Vision Inc. were ordered by the U.S.

CFTC fraud

CFTC

Commodity Futures Trading Commission (CFTC) to pay a civil monetary penalty of $575,000 and restitution of $574,936 for illegally soliciting participants in a pooled investment vehicle, misappropriation of their funds and issuing bogus statements to cover up losses on trading and fraud.

The order also enjoins Kinseth, who was not registered with the CFTC, and Virtual Vision from undertaking any activities relating to commodity trading and for registering with the CFTC or seeking exemption from registration.

According to the order, Virtual Vision, a pooled investment vehicle, and Kinseth, its director and president, solicited $975,360 from about 11 individuals for trading commodity futures contracts and foreign currency contracts.  But funds amounting over $800,000 were misappropriated by Kinseth to pay other investors and for his personal expenses, while losses were incurred on the amount actually traded.

These losses, and the misappropriation, were sought to be concealed from investors by issuing false account statements that showed profits where there were none.

The CFTC simultaneously filed and settled the above charges against Kinseth and Virtual Vision. CFTC enforcement staff Vincent A. McGonagle, Timothy M. Kirby, Brian G. Mulherin and Gretchen L. Lowe were responsible for the case.

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