Judge Freezes Assets of Newport Beach Futures Commission Merchant

The complaint further alleges that FX First failed to maintain the minimum amount of net assets required to operate as a futures commission merchant. CFTC regulations require a minimum adjusted net capital of US$250,000. As of Sept. 26, the actual net capital of FX First was less than that–indeed, it was negative: Liabilities exceeded assets by approximately US$1,670,000.

According to the complaint, Mr. Mironov is a signatory on the bank accounts of the corporation “and responsible for the day-to-day financial matters involving the corporation, including making decisions involving payments to customer and employees, disbursements and other matters relating to FX First’s finances.” Mr. Whyte is registered with the CFTC as an “associated person” and is “responsible for the day-to-day operations of the corporation such as hiring and firing of employees and the supervision and training of employees.” The complaint adds that the two men coordinate on financial matters.

The complaint alleges that FX First has misappropriated customer funds by their transfer to a foreign affiliate and their use to pay for miscellaneous business expenses.

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