Cook operated the currency program through various foreign currency trading firms, including but not limited to one located in Chicago and another in Switzerland. To induce investors, the defendants, Cook, and Pettengill, directly or through others acting at their direction, made false representations regarding the performance, safety, and liquidity of the currency program.
Specifically, they alleged that the currency program would earn a double-digit rate of return, typically between 10.5 and 12 percent annually, with little to no risk to investment assets. The men also claimed that investor assets could be withdrawn at any time and would be held in segregated accounts. Those representations, however, were false. When soliciting victim investors, the men also made misrepresentations and omitted material information concerning their backgrounds and qualifications as well as the backgrounds and qualifications of those working at their direction.
Once investments were made, investors generally received statements from the UBS entities, and some received investment return checks, also from the UBS Entities. The defendants, Cook, and Pettengill caused the production and transmission of those statements and checks. The statements gave the false appearance that the currency program was performing as promised, and that investments were held in individual, segregated accounts. Most investors, however, failed to receive statements or checks from the custodians in actual possession of their funds.
Justice.gov press release link: click here