Key Takeaways
- • The CFTC secured a final judgment against Tae Hung Kang (Kevin Kang), CEO of ForexnPower, requiring $835,058 in restitution to defrauded customers and imposing a permanent trading and registration ban.
- • The original complaint, filed September 25, 2015, alleged fraudulent solicitation of over $1.5 million from customers for off-exchange forex trading, plus misappropriation of over $800,000 in customer funds through misleading advertisements in Korean-language newspapers.
- • The fraudulent scheme operated between October 2010 and December 2013, during which Kang served as CEO and associated person of Safety Capital Management, Inc. and GNS Capital Inc., both operating as ForexnPower.
- • The final judgment imposes permanent injunctive relief prohibiting further violations of the Commodity Exchange Act (CEA) and CFTC regulations, effectively barring Kang from future forex trading activities and regulatory registration.
- • Enforcement actions against other defendants named in the original complaint—including Sungmi Kang, John Won, Safety Capital Management, Inc., and GNS Capital Inc.—remain ongoing.
Summary
The U.S. District Court for the Eastern District of New York entered a final judgment on September 8, 2022, resolving the Commodity Futures Trading Commission's enforcement action against Tae Hung Kang, the former CEO of ForexnPower. The order mandates that Kang pay $835,058 in restitution to victims and subjects him to permanent injunctive relief and trading restrictions.
The underlying CFTC complaint was filed on September 25, 2015, against Kang and four additional defendants: Sungmi Kang, John Won, Safety Capital Management, Inc., and GNS Capital Inc. (both entities operating under the ForexnPower name). The complaint alleged that between October 2010 and December 2013, Kang and his co-conspirators engaged in fraudulent solicitation of retail forex customers through misleading advertisements published in Korean-language newspapers. The scheme resulted in losses exceeding $1.5 million in fraudulently solicited customer funds and an additional $800,000 in misappropriated customer assets.
Operating as CEO and associated person of Safety Capital d/b/a ForexnPower, Kang solicited and accepted clients for managed off-exchange retail forex trading accounts and retail forex commodity pool operations. The defendants exploited the retail forex market segment, targeting Korean-speaking investors through targeted advertising and misrepresentations about trading performance and risk management.
The final judgment against Kang concludes one component of the broader CFTC enforcement action. The order imposes a permanent ban on Kang from violating the Commodity Exchange Act and CFTC regulations, and permanently prohibits him from registering with any CFTC-regulated entity or engaging in forex trading activities. Notably, enforcement proceedings against the other named defendants in the original action remain active, suggesting additional restitution and sanctions may follow.
The underlying CFTC complaint was filed on September 25, 2015, against Kang and four additional defendants: Sungmi Kang, John Won, Safety Capital Management, Inc., and GNS Capital Inc. (both entities operating under the ForexnPower name). The complaint alleged that between October 2010 and December 2013, Kang and his co-conspirators engaged in fraudulent solicitation of retail forex customers through misleading advertisements published in Korean-language newspapers. The scheme resulted in losses exceeding $1.5 million in fraudulently solicited customer funds and an additional $800,000 in misappropriated customer assets.
Operating as CEO and associated person of Safety Capital d/b/a ForexnPower, Kang solicited and accepted clients for managed off-exchange retail forex trading accounts and retail forex commodity pool operations. The defendants exploited the retail forex market segment, targeting Korean-speaking investors through targeted advertising and misrepresentations about trading performance and risk management.
The final judgment against Kang concludes one component of the broader CFTC enforcement action. The order imposes a permanent ban on Kang from violating the Commodity Exchange Act and CFTC regulations, and permanently prohibits him from registering with any CFTC-regulated entity or engaging in forex trading activities. Notably, enforcement proceedings against the other named defendants in the original action remain active, suggesting additional restitution and sanctions may follow.
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