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On 13 January 2025, the United States Commodity Futures Trading Commission (US CFTC) announced that Mosaic Exchange Ltd. and its CEO, Sean Michael, have been ordered by the US District Court for the Southern District of Florida (case 9:23-cv-8130-AMC) to pay over $1.1 million in penalties and restitution. This judgment follows findings of fraudulent digital asset solicitation and trading activities conducted between February 2019 and June 2021. US CFTC filed a complaint on 26 September 2023, alleging that Mosaic and Michael fraudulently solicited 18 individuals to trade Bitcoin and other digital asset commodities, misrepresented their assets under management, fabricated trading success rates, and misappropriated customer funds. These violations contravened the US Commodity Exchange Act (CEA) and US CFTC regulations. The defendants, who failed to respond adequately to legal proceedings, were found liable by default judgment orders entered on 23 December 2024 and 30 December 2024​​....

On 13 January 2025, the United States Securities and Exchange Commission (US SEC) published order instituting administrative and cease-and-desist proceedings, pursuant to sections 15(b) and 21c of the United States Securities Exchange Act of 1934, making findings, and imposing remedial sanctions and a cease-and-desist order civil penalties totalling US$45 million against Robinhood Securities LLC and Robinhood Financial LLC for multiple violations of federal securities laws. This enforcement action addresses lapses in their brokerage operations, including trading activity reporting, regulatory compliance, recordkeeping, and safeguarding customer information. The US SEC’s investigation revealed a series of violations by Robinhood firms between 2018 and 2024, including delays in filing suspicious activity reports, inadequate identity theft prevention measures, improper handling of off-channel communications, and deficiencies in cybersecurity safeguards. Robinhood Securities was...

On 10 January 2025, the United Kingdom Financial Conduct Authority (UK FCA) announced that it had fined Arian Financial LLP £288,962.53 for failings in its systems and controls against financial crime. The UK FCA found that Arian's shortcomings exposed the firm to risks of facilitating fraudulent trading and money laundering linked to cum-ex trading schemes and withholding tax reclaims. The investigation revealed that between January and September 2015, Arian executed over-the-counter equity trades totalling approximately £37 billion in Danish equities and £15 billion in Belgian equities for clients associated with the Solo Group. These trades, described as circular and indicative of financial crime, were used to arrange withholding tax reclaims in Denmark and Belgium. During the period in question, the Solo Group submitted tax reclaims amounting to £899.27 million to Danish authorities and £188 million to Belgian authorities, of which payments of £845.9 million and £42.33 million,...

On 10 January 2025, the Hong Kong Securities and Futures Commission (HK SFC) issued a public warning against an unlicensed virtual asset trading platform (VATP) known as International Standard Carbon Assets Technology Co., Limited, or “iSCAT” and “iSCAT Exchange”. This platform, which claims to provide cryptocurrency trading services, has not been granted a licence by the HK SFC and is therefore operating unlawfully under Hong Kong regulations. The HK SFC in its publication, revealed that "iSCAT" has been promoting its services through social media, directing potential investors to its website and mobile application for trading cryptocurrencies. Such operations fall under the category of regulated activities as defined in Hong Kong’s Securities and Futures Ordinance (HK SFO) and the Anti-Money Laundering and Counter-Terrorist Financing Ordinance. These laws prohibit entities from carrying out virtual asset services, including the operation of virtual asset exchanges, or marketing...

On 7 January 2025, the United States Securities and Exchange Commission (US SEC) published updated Frequently Asked Questions (FAQs) related to Rule 35d-1 under the United States Investment Company Act of 1940, commonly known as the “names rule.” These 2025 FAQs reflect changes stemming from the 2023 amendments to the rule, which aim to address investment company names that could mislead investors about a fund’s investments and risks. As part of the update, the US SEC has withdrawn certain outdated FAQs from the 2001 guidance, marking a significant step in modernising regulatory interpretations for the financial industry. The “names rule,” officially Rule 35d-1 under the United States Investment Company Act of 1940, was first adopted by the US SEC in 2001 to address the potential for misleading investment company names. Fund names can strongly influence investor decisions, often implying a particular investment focus or risk profile. To protect investors, the rule mandated that funds...

On 7 January 2025, the United States Securities and Exchange Commission (US SEC) published the Litigation release. On 12 December 2024, the United States District Court for the Western District of Texas issued a final judgment against Leena Jaitley, a former resident of Austin, Texas, for her role in defrauding investors through two fraudulent websites, Managed Options Trading and Options by Pros. This ruling followed an investigation and litigation conducted by US SEC, which uncovered a scheme that caused financial harm to unsuspecting investors. Leena Jaitley operated her fraudulent websites from 2018, falsely claiming that they employed skilled New York-based traders using a proprietary trading methodology with a successful track record. Instead, Leena Jaitley worked alone from her Austin home, occasionally involving her father, who lacked any professional trading qualifications. The US SEC’s investigation revealed that Leena Jaitley’s actions led to at least 15 investors losing...

On 7 January 2025, Rostin Behnam, Chairman of the United States Commodity Futures Trading Commission (US CFTC), announced his decision to step down from his role, with his final day at the Commission set for 7 February 2025. Chairman Behnam’s tenure at the US CFTC spanned over seven years, during which he played a pivotal role in guiding the agency through a period of significant market evolution and global challenges. Rostin Behnam joined the US CFTC in 2017 as a commissioner and later assumed the role of Chairman, leading the agency during a transformative era for global financial markets. The US CFTC, which oversees the derivatives markets that underpin critical segments of the US economy, has navigated regulatory complexities under his stewardship. Behnam’s tenure coincided with periods of market volatility driven by domestic and international economic events. His leadership focused on addressing regulatory gaps, managing market risks, and fostering innovation through responsible...

On 7 January 2025, during a Parliament sitting, Mr. Gan Kim Yong, Deputy Prime Minister and Minister for Trade and Industry, and Chairman of the Monetary Authority of Singapore (MAS), addressed a query on credit card fraud raised by Mr. Desmond Choo, Member of Parliament for Tampines GRC. The question centred on the frequency and scale of credit card fraud in recent years, and whether a framework akin to the Shared Responsibility Framework (SRF) could be introduced to clarify the obligations of banks and cardholders in such cases. Mr. Desmond Choo asked the government to provide statistics on the number of credit card fraud cases reported over the past three years, the corresponding quantum of losses, and whether a framework similar to the SRF could be applied to credit card fraud. The SRF, a framework for electronic banking fraud, clarifies responsibilities in the event of fraud and helps define acts of gross negligence and reasonable reporting timelines. In response, Mr. Gan...

On 7 January 2025, the Hong Kong Monetary Authority (HKMA) issued a public alert regarding phishing instant messages impersonating Bank of China (Hong Kong) Limited. The advisory highlights fraudulent messages reported to the HKMA and discusses the importance of vigilance among the public in avoiding financial scams. The alert accompanies a press release issued by Bank of China (Hong Kong) Limited, accessible via the HKMA's official website. This warning comes in response to reports of fraudulent instant messages that mimic official communication from Bank of China Limited. These messages aim to deceive recipients into providing sensitive personal and financial information, such as login credentials and One-Time Passwords (OTPs). The HKMA in this press release states that banks in Hong Kong, including Bank of China Limited, do not use SMS or emails with embedded hyperlinks to direct customers to transactional websites. They also do not request personal or sensitive information via...

On 7 January 2025, the Reserve Bank of India (RBI) announced the winners of the third edition of its global hackathon, HaRBInger 2024 – Innovation for Transformation, during a grand finale in Bengaluru. The event brought together innovators, industry leaders, and policymakers to celebrate groundbreaking technological solutions aimed at tackling financial fraud, FinTech and enhancing accessibility for differently-abled individuals. The RBI launched HaRBInger 2024 on 7 June 2024, focusing on two themes: ‘Zero Financial Frauds’ and ‘Being Divyang Friendly.’ The hackathon encouraged participants to overcome four challenges: developing real-time fraud detection systems, ensuring transaction anonymity in Central Bank Digital Currency (CBDCs) systems, identifying mule bank accounts, and creating solutions for currency identification by visually impaired individuals. A special category was also introduced to honour the best all-women team, to enhance inclusivity and diversity in innovation....