Razor FX and unsuspecting investors: Where are their brains?
News broke this week of what appears to be an incredible Ponzi scheme in the US FX market.
Michael MacCaull, who is a principal at a company called Razor FX, has been charged with a scheme to defraud investors of as much as $68 million. He pleaded not guilty at a hearing on Tuesday.
MacCaull has history as a fraudster. Back in 2002, he got a 15-month prison sentence after pleading guilty to conspiracy to commit securities fraud, mail fraud and wire fraud at a company called Sterling Foster & Co, which was effectively a boiler room. According to Dow Jones Newswires, this time around prosecutors have alleged that MacCaull and an unidentified partner engaged in a conspiracy to defraud investors by purporting to trade FX. It is alleged that in reality very few transactions were carried out and that the company made up P&L reports, which it sent to its clients.
What is absolutely astounding is that investors have handed over such a massive sum to Razor FX since it opened in February 2007. The company’s website – http://razorfx.net/default.htm – which at the time of writing was still live, claims: “Razor FX will always put the client first.