The Seriousness and Data Surrounding the Allegation
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On September 22, 2023, the Commodity Futures Trading Commission (“CFTC”) issued an order against Jie “Elaine” Yu (“Yu” or “Respondent”), who was associated with Cetera Investment Services LLC and Cetera Investment Advisers LLC. The CFTC had reason to believe that in 2021, Yu violated Section 4c(a)(2)(A)(ii) of the Commodity Exchange Act (“Act”) and Commission Regulation (“Regulation”) 1.38(a). During October and November of 2021, Yu allegedly engaged in a series of 33 non-competitive, fictitious sales of 410 futures contracts on the Chicago Mercantile Exchange (“CME”). These illegal transactions allowed Yu to transfer at least $159,000 to her cousin, “Trader A” in Shanghai, China.
As a result of these violations, the CFTC ordered Yu to cease and desist from violating the Act and Regulation, pay a civil monetary penalty of $300,000, and comply with several conditions and undertakings. Yu was also subjected to a trading ban for six months, during which all registered entities were to refuse her trading privileges.
Understanding the Allegation and the FINRA Rule
The alleged actions of Jie “Elaine” Yu are serious violations of the Commodity Exchange Act and the Commission Regulation. The Act prohibits fictitious sales involving the purchase or sale of any commodity for future delivery, while Regulation 1.38(a) prohibits entering into illegal, non-competitive fictitious transactions to buy and sell commodities for future delivery. These rules are in place to ensure fair and transparent trading in the commodities market.
Essentially, Yu was accused of making fake sales of futures contracts, which are agreements to buy or sell a specific quantity of a commodity at a predetermined price and future date. These fictitious transactions allowed Yu to illegitimately transfer funds to another trader, violating the laws designed to prevent such fraudulent activity.
Why This Matters to Investors
Such allegations are of significant concern to investors. The integrity of the trading system is paramount to investor confidence and the overall health of the financial markets. When individuals like Jie “Elaine” Yu allegedly engage in fraudulent activities, it undermines the trust in the system and can lead to financial losses for investors.
Moreover, investors who have worked with Yu or Cetera Investment Services LLC and Cetera Investment Advisers LLC, may have suffered losses due to these alleged illegal activities. These investors may have a valid claim to recover their losses.
Red Flags for Financial Advisor Malpractice and Recovering Losses
Investors should be aware of red flags that may indicate financial advisor malpractice. These can include unusual account activity, a lack of transparency in transactions, and transactions that the investor does not understand or did not authorize. If you notice these or other suspicious activities, it’s important to take action promptly.
Investors who have suffered losses due to the actions of Jie “Elaine” Yu or Cetera Investment Services LLC and Cetera Investment Advisers LLC may be able to recover their losses through FINRA Arbitration. Haselkorn & Thibaut, a national investment fraud law firm with over 50 years of experience and a 98% success rate, is currently investigating the advisor and company. They offer free consultations to clients and operate on a “No Recovery, No Fee” policy. You can reach them at their toll-free consultation number, 1-800-856-3352.
With offices in Florida, New York, North Carolina, Arizona, and Texas, Haselkorn & Thibaut has successfully helped investors recover their financial losses. Don’t let financial advisor malpractice go unchecked. Take action today to protect your investments and potentially recover your losses.