Corporate & Securities Law

The SEC recently charged two South Florida residents with operating a $30 million Ponzi scheme related to a purported foreign currency trading operation.

From at least 2005 through 2007, James Clements and Zeina Smidi of Plantation, Florida, solicited investors to invest in a purported foreign currency operation which touted guaranteed monthly returns as high as 11%.  Some of the entities the investors invested in include MRT, LLC; MRT Holdings, LTD; and Maximum Return Transaction, LLC. 

MRT and Clements raised funds from investors primarily through offering and selling unregistered investment contracts and promissory notes to hundreds of investors across the nation.  Clements also allegedly recruited ?account managers? who were paid a small percentage of the returns for soliciting hundreds of investors through information meetings and word of mouth. 

In 2007, Clements told the account managers that rather than continuing to trade foreign currency he gave investors the option for rolling over their current investment into a Swiss Bank account that earned 25% annually with a one-year fixed term, or 15% annually but allowed for monthly withdrawals. 

Contrary to their representations to investors, Clements and Smidi actually are believed to have operated a Ponzi scheme with investor money.  MRT is believed to have never traded more than a fraction of what the investors invested, and overall lost more than $65,000 trading in foreign currencies.  Moreover, the SEC has alleged that MRT never deposited investor money with a Swiss Bank and paid returns to investors using subsequent investor deposits in a classic Ponzi scheme manner.  Clements and Smidi are believed to have misappropriated at least $3 million of investor money for personal use.  

Eccleston Law represents individual and institutional investors to recover their investment losses caused by securities and investment fraud. Our attorneys also help victims of Ponzi schemes pursue recovery by submitting claims with receiverships established by the SEC or by assisting victims with the filing of a Theft Loss Tax Deduction with the IRS.

If you have lost money investing with James Clements, Zeina Smidi, or MRT, you may be eligible for an immediate theft loss tax deduction.  Under a new IRS safe harbor rule, you may be eligible for an immediate theft loss tax deduction of 95% of your losses, or 75% of your losses if you pursue third-party recovery. Please contact Jim Eccleston at the Eccleston Law Offices at 312-332-0000 for more details.