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Sunday, September 20, 2009

CFTC: CapitalStreet Financial ran a $1.3M Ponzi scheme

Charged with misappropriating $875,000 of customer funds

The Commodity Futures Trading Commission has charged CapitalStreet Financial LLC, a foreign exchange trading firm in Denver, N.C., with operating a Ponzi scheme in which at least 69 customers were allegedly bilked out of an estimated $1.3 million.
The company was charged along with Sean F. Mescall, also of Denver, with misappropriating approximately $875,000 of customer funds to pay purported profits to customers and for their personal use.
CapitalStreet and Mr. Mescall, who was identified as an “officer” of CapitalStreet in the CFTC complaint filed last week, provided customers with false monthly statements to conceal trading losses and misuse of customer funds, according to the CFTC. They also directed funds to “relief defendants” Gaincapital Inc. and Gerald Mescall, a relative of Sean Mescall, also of Denver, N.C.

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