A former broker was sentenced to 3-6 years in prison for defrauding investors out of more than $489,000 during a three-year foreign currency trading scheme, New York Attorney General Letitia James announced Thursday.

Jason Ari Amada, 42, of Forest Hills, Queens, stole the money from eight people who had invested in a “bogus foreign currency trading venture” that he ran from 2015 to 2018, James said. He had not been a registered broker since 2012.

Amada was sentenced in New York County Supreme Court after signing confessions of judgment in favor of his eight victims, she said.

In September, Amada pleaded guilty to grand larceny in the second degree, a Class C felony, and scheme to defraud in the first degree, a Class E felony, before Judge Maxwell Wiley. His guilty pleas resolved two sets of charges brought by the attorney general’s Criminal Enforcement and Financial Crimes Bureau, James said.

Amada was arrested Aug. 29, 2018, on an indictment, charging him with fraudulently soliciting a client to invest €250,000, or about $277,000, and then losing 99% of that investor’s principal in less than 45 days of aggressive foreign currency trading, James said. Following his arrest, additional victims reported they had invested and lost money with Amada under similar circumstances. The Office of the Attorney General filed charges against Amada related to claims brought forward by seven other victims who were fraudulently solicited to invest with Amada between March 2015 and November 2018, James noted.

Amada had claimed publicly that he was an experienced trader in foreign currency — or forex — and the operator of multiple legitimate investment management firms. But he failed to disclose to his victims that he hadn’t been a licensed broker since 2012, James said.

Amada’s firm, Hold Brothers On-Line Investment Services (also known as Tafferer Trading), was expelled from the securities industry by the Financial Industry Regulatory Authority Nov. 26, 2012, according to FINRA’s BrokerCheck website. He was affiliated with that firm from 2003 to 2007 and, before that, was registered with Worldco from 2001 to 2003 and with Morgan Stanley from 2000 to 2001, according to BrokerCheck.

Amada “also did not reveal” to investors that the “various ventures he claimed to be associated with — Amada Capital Management LLC, Amada Capital LLC and Evolution FX Trading — were mere shell corporations with no employees or genuine operations,” James said. Those venture also weren’t registered with any regulatory authorities to trade foreign currencies, she said.

Amada convinced his investors he could trade forex safely and that capital preservation strategies would be used to protect their investments, according to James. For example, he falsely represented to one victim that she wouldn’t lose more than 1% of her total investment, James said. Amada led another victim to believe he would use a hedging strategy that would minimize any potential losses, she noted, adding: “Contrary to his false representations to victims, Amada used highly leveraged, aggressive trading tactics that resulted in the rapid and complete dissipation of his victims’ funds, while at the same time earning over $150,000 in fees and commissions for himself.”

Amada also “diverted investor monies to pay for his own personal expenses,” James said, sometimes “through corporate bank accounts into his own personal bank accounts, and, on some occasions, simply cashed the victim’s investment checks.”

Between 2015 and 2018, Amada spent about $100,000 of investor dollars on his own travel, dining, clothing, credit card bills, personal loans, payments to family and friends, buying cryptocurrency and “even on online gambling; he also made over $83,000 in cash withdrawals,” according to James.

To further his scheme, Amada hid the trading losses and misappropriation of investor funds by providing his victims with fake account statements, James said. Each month, Amada “invented details of profitable trades to enter into elaborate statements that he would email his victims,” she noted, adding those “forged” statements showed growing account balances and “swelling profits,” masking his crimes and enabling him to convince some victims to continue investing. “Amada deceived some of his victims for years about the status of their investments [and] they only discovered the truth once they asked Amada to return their investments, and he could not do so,” according to James.

Amada didn’t immediately respond to a request for comment about his sentencing.

The Commodity Futures Trading Commission had filed a federal court enforcement action in the U.S. District Court for the Southern District of New York against Amada and Amada Capital Management LLC on Aug. 29, claiming that, from at least February 2014 through at least November 2015, the defendants fraudulently solicited potential clients to open individually managed trading accounts for off-exchange foreign currency contracts and hid substantial trading losses incurred as a result of his managed forex trading.