CFTC Bars Eight Americans Who Sold Offshore Forex Trading to US Retail Clients
The Commodity Futures Trading Commission (CFTC) has barred eight Americans for two years for soliciting US retail traders on behalf of unregistered offshore brokers.
The eight individuals settled without admitting the findings and owe $650,000 in parallel cases brought by the Securities and Exchange Commission (SEC). The orders mark a shift in focus from the technology providers to the people who sold their product to US customers.
In June, Netrios LP Ltd. and Red Acre Ltd. agreed to pay $2.5 million for providing the white-label service behind these brokers. The eight co-owned brokers built on that service, with customers depositing about $296 million into KOT4X alone, the largest of the four brokers named by the SEC.
Brokers Collected Millions
The SEC's orders against seven of the eight individuals, dated September 30, named the brokers and revealed deposit figures. KOT4X, incorporated in St. Vincent and the Grenadines and active from 2019 to 2025, attracted about $296 million in customer deposits.
The SEC described Black as a social media influencer known online as "Cue Banks", the kind of promotion that 17 regulators targeted in a joint week of action in April.
Prosperity LLC, run by Michael Talento, Jordan Taylor Morgan and Michael Levi Peters, took in about $35 million. Envi LLC, owned by Tyler Evan MacKechnie, drew $34 million, while FxSway LLC, co-owned by Lewis Matthew Neal, attracted $26 million. Across these four brands, deposits totaled about $391 million.
White-Label Operations
According to the SEC, the brokers purchased almost everything from white-label providers, including websites, contracts for difference (CFDs), back-office systems, trading apps, pricing, liquidity, custody and customer verification.
In MacKechnie's case, Netrios also introduced him to other service providers needed to establish the firm. Customers funded accounts using bitcoin or other crypto assets held in margin accounts by the providers. The brands earned commissions and swap fees, primarily from forex trading, along with metals, crypto, stock indices and single stocks.
Regulatory Response
The CFTC and SEC split jurisdiction based on the products. Forex, metals and crypto trades fall under the CFTC, while CFDs on single stocks count as security-based swaps, bringing in the SEC. KOT4X offered CFDs on 37 US and European shares.
US regulators have previously pursued individuals handling orders without proper registration. On June 30, the National Futures Association fined Marex Spectron $350,000 for allowing unregistered staff to take US orders. The CFTC maintains a public warning list of foreign firms dealing with US clients without registration, which contained nearly 300 entities by May 2025.
The CFTC is simultaneously pursuing offshore brokers while drafting a legal framework for leveraged retail crypto trading, having requested public comment on that proposal in October. The SEC orders also bar the respondents from the securities industry, with the possibility of reapplying after two years. KOT4X is no longer in operation.
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