LAS VEGAS (CN) — A federal judge ordered a Bay Area man and his Nevada company to pay $672,626 in penalties and disgorgement for an illegal commodity futures trading scheme.
U.S. District Judge Gloria Navarro on Tuesday permanently enjoined Mirko Schacke, of Antioch, California, and his wholly owned company TradeMasters, of Henderson, Nevada from defrauding investors by acting as a commodity trading adviser and lying about trade results.
Navarro ordered Schacke and his company to pay $168,626 in disgorgement and $504,000 in fines.
Schacke in mid-2013 bought an off-the-shelf commodity futures trading software package, put a white label on it and called it his own TradeMasters USA commodities trading software, Navarro found.
He marketed the rebranded trading software on a website that he developed and kept active until September 2016, and through social media.
Schacke sold the software via licensing agreements for $1,500 to $20,000 and charged monthly access fees of $250 to $1,000.
Thirty-nine customers paid Schacke a total of $168,626 for the software and monthly fees.
Schacke also made false claims of clients’ success with the software: for instance, that one investor realized a 300 percent profit after only a couple months of trading.
The Commodity Futures Trading Commission in August 2016 accused Schacke and TradeMasters of fraud, deception, failure to provide required disclosures, failure to register as a securities adviser, and violating the Commodity Exchange Act.
Navarro found that Schacke’s response to the complaint did not leave any unanswered questions of material fact, and granted the CFTC’s motion for summary judgment on Tuesday.
The court entered the order on Wednesday.