Amrit JS Chahal, 30, of Fairfax, Virginia has been charged by the Securities and Exchange Commission (SEC). The US Attorney's Office for the Eastern District of Virginia also announced criminal charges against Mr Chahal. The Commodities Futures Trading Commission also charged him.
The Securities and Exchange Commission's complaint alleges that, from at least February 2015, Mr Chahal used his company, Kane Capital Investment Group to fraudulently solicit approximately $1.4 million from about 50 individuals, including friends and family members.
Mr Chahal is the President, Chief Executive Officer, and sole employee of Kane Capital. He has never held any securities licenses, nor has he ever been associated with a registered broker-dealer or investment adviser other than Kane Capital.
According to the complaint, Mr Chahal lured investors by falsely claiming to be an experienced and successful trader who could generate above-market returns for clients through a low-risk trading strategy.
The Securities and Exchange Commission alleges that, in reality, Mr Chahal had substantially no experience working in the financial or securities industry or trading securities on behalf of clients. The complaint further alleges that Mr Chahal initially invested client funds in a variety of investments, but suffered significant trading losses.
According to the complaint, instead of disclosing the losses, Mr Chahal lied to his clients about their investment returns, continued raising funds, then used the money for his personal benefit, including to pay for his luxury car, rent, travel, dining, and other living expenses, and to make Ponzi-like payments to earlier investors.