# Commodity Futures Trading Commission v. Oasis International Group, Limited

> District Court, M.D. Florida · December 6, 2023

URL: https://www.frixlaw.com/law-library/cases/10114662

## Case

- **Court:** District Court, M.D. Florida
- **Decided:** December 6, 2023
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION

COMMODITY FUTURES
TRADING COMMISSION,

Plaintiff,

v. Case No. 8:19-cv-886-VMC-SPF

OASIS INTERNATIONAL GROUP,
LTD., et al.,

Defendants.
______________________________/
ORDER
This matter is before the Court on consideration of
Plaintiff Commodity Futures Trading Commission’s Motion for
Summary Judgment Against Defendant Michael J. DaCorta (Doc.
# 749), filed on July 17, 2023, and Michael J. DaCorta’s
Motion for Summary Judgment on Behalf of Defendant Michael
J. DaCorta (Doc. # 750), also filed on July 17, 2023. Both
parties responded on August 7, 2023. (Doc. ## 756, 757).
Both parties also replied on August 21, 2023. (Doc. ## 761,
762). For the reasons that follow, the Commodity Futures
Trading Commission’s Motion is granted, and Michael J.
DaCorta’s Motion is denied.
I. Background
A. Procedural History
Plaintiff Commodity Futures Trading Commission
(“CFTC”) filed a complaint against Defendants Oasis
International Group, Limited (“OIG”), Oasis Management, LLC
(“OM”), Satellite Holdings Company (“SHC”), Michael J.
DaCorta, Joseph S. Anile, II, Raymond P. Montie, III,

Francisco L. Duran, and John J. Haas on April 15, 2019.
(Doc. # 1). This complaint alleged violations of the
Commodity Exchange Act (“Act”) and the regulations
promulgated under it. (Id.). Specifically, the complaint
alleged that Defendants had “engaged in a fraudulent scheme
to solicit and misappropriate money from over 700 U.S.
residents for pooled investments in retail foreign currency
contracts.” (Id. at 1). The Court subsequently entered a
restraining order against Defendants. (Doc. # 7). It also
entered Consent Judgments for preliminary injunctions and
other equitable relief against Defendants later that year.

(Doc. ## 43, 174-76). The CFTC also filed an amended
complaint on June 12, 2019. (Doc. # 110).
Now, the CFTC seeks final summary judgment in its
favor against DaCorta. (Doc. # 749). DaCorta also seeks
final summary judgment in his favor. (Doc. # 750). Both the
CFTC and DaCorta responded (Doc. ## 756, 757), and replied.
(Doc. ## 761, 762). The Motions are ripe for review.
B. The Oasis Entities1
The claims against DaCorta stem from his conduct
regarding two entities: (1) OIG and (2) OM (together, the
“Oasis entities”). OIG “solicited, received, and accepted
funds” for foreign exchange (“forex”) trading. (Doc. # 749

at ¶ 9; Doc. # 749-3 at 50:5-10). Similarly, OM “solicited,
received, and accepted funds for investment.” (Doc. # 749
at ¶ 11; Doc. # 749-2 at 94:1-8). Both OIG and OM
aggregated funds from participants into pools for
investment purposes. (Doc. # 4-1 at ¶¶ 45, 48, 57, 60).
Neither OIG nor OM was operated like a typical
company. Neither entity retained standard written policies
nor prepared income statements that disclosed their losses.
(Doc. # 749 at ¶¶ 13, 15; Doc. # 757 at ¶¶ 13, 15).

1 While DaCorta disputes several of the underlying facts of
this case, he does not provide sufficient evidence to
create a genuine dispute of material fact. See Jeffery v.
Sarasota White Sox, Inc., 64 F.3d 590, 593–94 (11th Cir.
1995) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 324
(1986)) (“When a moving party has discharged its burden,
the non-moving party must then ‘go beyond the pleadings,’
and by its own affidavits, or by ‘depositions, answers to
interrogatories, and admissions on file,’ designate
specific facts showing that there is a genuine issue for
trial.”).
Additionally, the pooled funds were not retained in
accounts named after the commodity pools. E.g., (Doc. # 4-1
at ¶ 30) (discussing two accounts named “Fundadministration
Inc.” and “Fundadministration Inc./Mainstream Fund
Services”).
Further, within each entity, funding from participants
was commingled with funding used for other purposes. At

OIG, the bank account used to pay employees, principals,
and charges related to OIG’s properties consisted entirely
of participant funds provided for investment purposes.
(Doc. # 749-2 at 153:5-157:13). Similarly, the OM bank
account consisted primarily of participant funds. (Doc. #
4-1 at ¶¶ 44-45). DaCorta admitted to using some of the OM
account funds to purchase “at least two personal
residences, multiple luxury vehicles . . . , vacations, and
a trip on a private jet.” (Doc. # 749 at ¶ 50; Doc. # 757
at ¶ 50).
OIG and OM also insufficiently disclosed investment

risks to potential participants. OIG provided potential
participants with two documents: a “Promissory Note and
Loan Agreement” and an “Agreement and Risk Disclosures”
document. (Doc. # 749 at ¶ 62; Doc. # 757 at ¶ 62). The
Promissory Note and Loan Agreement guaranteed a minimum 12%
annual return on investment. (Doc. # 454 at 34). The
Agreement and Risk Disclosure also insufficiently alerted
participants to risks associated with foreign exchange
trading. See generally (Id. at 37-45) (excluding
disclosures required by 17 C.F.R. § 4.24(a)-(b)(2)); (Doc.
# 749 at ¶¶ 64-65).
OIG also did not provide required information to

participants about “fees and expenses incurred . . . , past
performance disclosures, [nor] a statement that the
[commodity pool operator] is required to provide all pool
participants with monthly or quarterly account statements,
as well as an annual report containing financial statements
certified by an independent public accountant.” (Doc. # 749
at ¶ 66) (noting that such disclosures are required by 17
C.F.R. § 4.24(d)-(w)); (Doc. # 454 at 34-45). Nor did OIG
provide information about the pools’ “aggregate
subscriptions . . . [,] current net asset value, or
information regarding the [pools’] largest draw downs.”

(Doc. # 749 at ¶ 67) (noting that such disclosures are
required by 17 C.F.R. § 4.25); (Doc. # 454 at 34-45).
Neither OIG nor OM have ever been registered with the
CFTC. (Doc. # 749 at ¶¶ 7, 12; Doc. # 757 at ¶¶ 7, 12).
C. DaCorta’s Relationship with the Oasis Entities
DaCorta played a leading role in the management and
operations of OIG and OM. DaCorta was a co-founder,
principal shareholder, and director of OIG. (Doc. # 749 at
¶ 3; Doc. # 757 at ¶ 3). He also acted as OIG’s Chief
Executive Officer and Chief Investment Officer. (Doc. # 749
at ¶ 4; Doc. # 757 at ¶ 4). In these positions, he was

responsible “for all investment decisions, trading
execution, services, sales, clearing, and operations.”
(Doc. # 749 at ¶ 4; Doc. # 757 at ¶ 4). He therefore
“served on the OIG Board of Directors, was a member of OIG,
was an officer of OIG, operated OIG, and controlled OIG.”
(Doc. # 749 at ¶ 8; Doc. # 757 at ¶ 8). DaCorta was also
the sole principal and general partner of OM. (Doc. # 749
at ¶ 10; Doc. # 757 at ¶ 10).
DaCorta played a prominent role in attracting new
participants to these entities. He participated in
conference calls with potential investors. (Doc. # 749-3 at

205:4-11, 206:8-15). He assured investors of a 12% annual
return and conveyed that his foreign exchange trading had
been profitable. (Doc. # 165-1 at ¶ 15). He further
informed call participants that trading risk was limited to
systematic risks. (Doc. # 749 at ¶¶ 30-31; Doc. # 757 at ¶¶
30-31). Finally, DaCorta also encouraged participants to
refer others to invest in the Oasis entities by promoting
opportunities to receive referral fees. (Doc. # 749 at ¶
32; Doc. # 757 at ¶ 32).
DaCorta was also responsible for all investment
decisions at the Oasis entities, including forex trading.
(Doc. # 749 at ¶ 68; Doc. # 757 at ¶ 68). He directed

deposits into the trading account for the OGFXSA, one of
the trading pools, and was listed as the sole trader in the
account applications for both pools. (Doc. # 749 at ¶¶ 69-
70; Doc. # 757 at ¶¶ 69-70). He was also the sole signatory
on OM bank accounts. (Doc. # 749 at ¶ 71; Doc. # 757 at ¶
71).
DaCorta also directed that participants be “issued
misleading account statements that concealed the trading
losses and misappropriation.” (Doc. # 749 at ¶ 45); (Doc. #
749-2 at 216:25-217:22) (stating that the investment portal
showed only “the amount of money lent and the amount of

accrued interest,” without showing losses); (Doc. # 749-3
at 216:25-217:18) (noting that portal setup was at
DaCorta’s direction). Specifically, these statements
prevented participants from viewing “profits, losses, or
fees attributable to their individual investments.” (Doc. #
749 at ¶ 72; Doc. # 757 at ¶ 72).
DaCorta was originally listed as a principal with the
National Futures Association (“NFA”) and registered with
the CFTC as an associated person of a Commodity Trading
Advisor from 2006 to 2010. (Doc. # 749 at ¶ 5; Doc. # 757
at ¶ 5). He withdrew both his registration and listing

after a 2010 settlement with the NFA. (Doc. # 749 at ¶ 5;
Doc. # 757 at ¶ 5). This settlement “barred him from
trading in any capacity that would require registration
with the NFA.” (Doc. # 749 at ¶ 6; Doc. # 757 at ¶ 6). He
never re-registered. (Doc. # 749 at ¶ 5; Doc. # 757 at ¶
5).
D. Forex Trading by the Oasis Entities
Over 800 participants invested over $75,000,000 in the
Oasis Entities. (Doc. # 165-1 at ¶ 12, 22; Doc. # 757 at ¶
33). Several participants contributed funding that
constituted a significant portion of their savings. See,

e.g., (Doc. # 756-8 at 19:7-20:18) (providing testimony
from Patti Katter that she wanted to invest in something
low risk and that the investment was a significant value
for her family).
Only approximately $22,000,000 of the funding
contributed was used for forex trading. (Doc. # 439 at 6).
DaCorta and other members of the entities misappropriated
over $28,000,000 of the funds invested by participants.
(Doc. # 165-1 at ¶ 23.d). The forex trading also was not
profitable. Between June 2015 and April 2015, the entities
had a net trading loss of $20,271,450.35. (Doc. # 749-4 at

165:19-167:1). Including fees and costs, losses totaled
over $62,000,000. (Id. at 167:2-6). On April 14, 2019, OIG
and OM, along with a related company SHC, owed participants
approximately $120,000,000. (Doc. # 165-1 at ¶ 23.a). On
this date, the entities had less than $10 million in
assets. (Id.). DaCorta was aware of these trading losses.
(Doc. # 749 at ¶¶ 42-43; Doc. # 757 at ¶¶ 42-43).
Profits were never returned to any bank account. (Doc.
# 749 at ¶ 41; Doc. # 757 at ¶ 41). Funds returned to
participants, totaling at least $30,364,607, were drawn
from investments by other participants. (Doc. # 439-7 at

16-17).
E. Related Criminal Proceeding
DaCorta was also prosecuted for several crimes based
on similar allegations to those underlying this complaint.
United States v. DaCorta, No. 8:19-cr-605-WFJ-CPT-1 (M.D.
Fla.). On May 4, 2022, a jury found DaCorta guilty of (1)
conspiracy to commit wire fraud and mail fraud, (2) money
laundering, and (3) making a false and fraudulent statement
on an income tax return. (Doc. # 749-9 at 2-3).
As to the count charging conspiracy to commit wire
fraud and mail fraud, the jury instructions stated that it
is “a Federal crime to knowingly and willfully conspire or

agree with someone to do something that, if actually
carried out, would result in the crime of wire fraud or
mail fraud.” (Doc. # 749-8 at 11). Importantly, DaCorta
needed to have “wrongful intent” to be guilty of
conspiracy. (Id. at 12). The instructions further defined
mail fraud and wire fraud, outlining that each requires
proof beyond a reasonable doubt that:
(1) the Defendant knowingly devised or
participated in a scheme to defraud someone, or
obtain money or property, using false or
fraudulent pretenses, representations, or
promises;

(2) the false or fraudulent pretenses,
representations, or promises were about a
material fact; [and]

(3) the Defendant intended to defraud someone . .
. .

(Id. at 14); (Id. at 16) (similar).
Additionally, mail fraud requires that the Defendant
used the services of a requisite mail carrier or the United
States Postal Service to help carry out the scheme. (Id. at
14). Similarly, wire fraud requires that “the Defendant
transmitted or caused to be transmitted by wire some
communication in interstate commerce to help carry out the
scheme to defraud.” (Id. at 16).

In total, the criminal trial established that
participants lost at least $53,270,336.08 from the
operations of the Oasis entities. (Doc. # 749-12 at 7). It
also determined that DaCorta personally obtained and
dissipated at least $2,817,876.16 in proceeds from his
conspiracy to commit wire fraud and mail fraud and money
laundering offenses. (Id. at 9).
II. Legal Standard
Summary judgment is appropriate “if the movant shows
that there is no genuine dispute as to any material fact
and the movant is entitled to judgment as a matter of law.”

Fed. R. Civ. P. 56(a). A factual dispute alone cannot
defeat a properly pled motion for summary judgment; only a
genuine issue of material fact will preclude summary
judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
247–48 (1986).
An issue is genuine if the evidence is such that a
reasonable jury could return a verdict for the non-moving
party. Mize v. Jefferson City Bd. of Educ., 93 F.3d 739,
742 (11th Cir. 1996) (citing Hairston v. Gainesville Sun
Publ’g Co., 9 F.3d 913, 918 (11th Cir. 1993)). A fact is
material if it may affect the outcome of the suit under the
governing law. Allen v. Tyson Foods, Inc., 121 F.3d 642,

646 (11th Cir. 1997).
The moving party bears the initial burden of showing
the court, by reference to materials on file, that there
are no genuine issues of material fact that should be
decided at trial. Hickson Corp. v. N. Crossarm Co., 357
F.3d 1256, 1260 (11th Cir. 2004) (citing Celotex Corp., 477
U.S. at 323). “When a moving party has discharged its
burden, the non-moving party must then ‘go beyond the
pleadings,’ and by its own affidavits, or by ‘depositions,
answers to interrogatories, and admissions on file,’
designate specific facts showing that there is a genuine

issue for trial.” Jeffery v. Sarasota White Sox, Inc., 64
F.3d 590, 593–94 (11th Cir. 1995) (quoting Celotex Corp.,
477 U.S. at 324).
If there is a conflict between the parties’
allegations or evidence, the non-moving party’s evidence is
presumed to be true and all reasonable inferences must be
drawn in the non-moving party’s favor. Shotz v. City of
Plantation, 344 F.3d 1161, 1164 (11th Cir. 2003). If a
reasonable fact finder evaluating the evidence could draw
more than one inference from the facts, and if that
inference introduces a genuine issue of material fact, the
court should not grant summary judgment. Samples ex rel.

Samples v. City of Atlanta, 846 F.2d 1328, 1330 (11th Cir.
1988). But, if the non-movant’s response consists of
nothing “more than a repetition of his conclusional
allegations,” summary judgment is not only proper, but
required. Morris v. Ross, 663 F.2d 1032, 1034 (11th Cir.
1981).
Further, the filing of cross-motions for summary
judgment does not give rise to any presumption that no
genuine issues of material fact exist. Rather, “[c]ross-
motions must be considered separately, as each movant bears
the burden of establishing that no genuine issue of

material fact exists and that it is entitled to judgment as
a matter of law.” Shaw Constructors v. ICF Kaiser Eng’rs,
Inc., 395 F.3d 533, 538-39 (5th Cir. 2004); see also United
States v. Oakley, 744 F.2d 1553, 1555 (11th Cir. 1984)
(“Cross-motions for summary judgment will not, in
themselves, warrant the court in granting summary judgment
unless one of the parties is entitled to judgment as a
matter of law on facts that are not genuinely disputed[.]”
(citation omitted)).
Finally, collateral estoppel can establish that a
genuine dispute of material fact does not exist.
Specifically, collateral estoppel “bar[s] a defendant who

is convicted in a criminal trial from contesting this
conviction in a subsequent civil action with respect to
issues necessarily decided in the criminal trial.”
Securities & Exchange Comm’n v. Rand, 805 F. App’x 871, 875
(11th Cir. 2020) (citing United States v. Jean-Baptiste,
395 F.3d 1190, 1194 (11th Cir. 2005)). Collateral estoppel
applies if (1) “the issue in question [is] ‘identical in
both the prior and current action,’” (2) “the issue [was]
‘actually litigated’ in the criminal trial”, (3) “the
determination of the issue [was] ‘critical and necessary to
the judgment in the prior action,’” and (4) “the burden of

persuasion in the subsequent action [is not] ‘significantly
heavier.’” Jean-Baptiste, 395 F.3d at 1195 (quoting In re
Bilzerian, 153 F.3d 1278, 1281 (11th Cir. 1998)).
“When the criminal conviction was based on a jury
verdict of guilty, ‘issues which were essential to the
verdict must be regarded as having been determined by the
judgment.’” Rand, 805 F. App’x at 875 (quoting Wolfson v.
Baker, 623 F.2d 1074, 1078 (5th Cir. 1980)). To determine
which issues were essential, “the court may ‘examine the
record of [the] prior proceeding, taking into account the
pleadings, evidence, charge, and other relevant matter, and
conclude whether a rational jury could have grounded its

verdict upon an issue other than that which the defendant
seeks to foreclose from consideration.’” Id. (quoting Ashe
v. Swenson, 397 U.S. 436, 444 (1970)).
III. Analysis
A. Michael J. DaCorta’s Motion for Summary Judgment
DaCorta contends that he is entitled to summary
judgment on all of the CFTC’s claims because the CFTC has
not met its burden on any of the elements of its claims.
For the reasons explained below, DaCorta’s Motion for
Summary Judgment is denied.
As a preliminary matter, this Court notes that it

agrees with the CFTC’s assessment that DaCorta’s Motion
does not comply with the Court’s order regarding summary
judgment motions. (Doc. # 756 at 1). The Motion does not
contain a section titled “Statement of Material Facts” with
each fact “supported by a pinpoint citation to the specific
part of the record relied upon to support that fact.” (Doc.
# 659 at 2). Violation of this order does constitute
grounds for denial of the motion. See Id. (“Failure to
submit a proper statement of material facts constitutes
grounds for denial of the motion.”). Even so, this Court
will briefly address the arguments raised in the motion.
DaCorta makes two arguments: (1) OIG and OM were not a

Ponzi scheme, as OIG was always solvent, and (2) the Oasis
entities did not operate commodity pools.
First, DaCorta argues that OIG and OM were not Ponzi
schemes because they were solvent. (Doc. # 750 at 34-37).
It is true that Ponzi schemes must be insolvent. See Wiand
v. Lee, 753 F.3d 1194, 1201 n.3 (11th Cir. 2014) (“[T]he
Ponzi scheme operator’s insolvency[] is necessarily present
in every Ponzi scheme.”). However, DaCorta does not clarify
how lack of conformity to this definition precludes the
CFTC’s success on any of the claims raised in this case.
Solvency and the presence of a Ponzi scheme are not

elements of any of the claims and, therefore, not relevant
to their resolution. See (Doc. # 756 at 17) (“[T]he CFTC
did not charge DaCorta . . . with ‘insolvency’ or with any
violations that require proof of insolvency as an element .
. . . [A] determination that DaCorta operated a Ponzi
scheme is not an element of any of the CFTC’s five counts
against DaCorta.”). DaCorta’s emphasis on these concepts is
misplaced.
The Court also acknowledges the concerns the CFTC
raises about the evidence DaCorta offers in support of his
insolvency and Ponzi scheme arguments. (Doc. # 756 at 19-
24). Given that the Court agrees with the CFTC that this

argument does not impact whether the CFTC may be granted
summary judgment on the counts alleged, this Court will not
further expound upon the insufficiencies of the evidence
provided.
Second, DaCorta argues that the Oasis entities did not
operate commodity pools. (Doc. # 750 at 37-42). Instead,
DaCorta argues that OIG and OM were eligible contract
participants (“ECPs”) and the CFTC does not have
jurisdiction over them. (Id. at 38-39).
A commodity pool is “any investment trust, syndicate,
or similar form of enterprise operated for the purpose of

trading in commodity interests.” 7 U.S.C. § 1a(10)(A).
These pools include any “agreement, contract, or
transaction described in section 2(c)(2)(C)(i) of this
title or section 2(c)(2)(D)(i) of this title,” which
include forex transactions. Id. § 1(a)(10)(A)(ii); Id. §
2(c)(2)(C)(i). “[A]ggregation of investors’ funds into a
single account” is an essential aspect of a commodity pool.
Commodity Futures Trading Comm’n v. Amerman, 645 F. App’x
938, 941-42 (11th Cir. 2016) (quoting Commodity Futures
Trading Comm’n v. Perkins, No. 06-4674 (RBK), 2009 WL
806576, at *4 (D.N.J. Mar. 25, 2009)). Here, no dispute
exists that funds from participants were aggregated into

entities OM and OIG. (Doc. # 749 at ¶¶ 21-25; Doc. # 757 at
¶¶ 21-25) (disputing the CFTC’s facts only as they included
terms such as “pool participants”). Additionally, the
record is clear that such funds were invested for trading
in commodity interests. (Doc. # 749 at ¶¶ 9, 11; Doc. #
749-2 at 94:1-8; Doc. # 749-3 at 50:5-10).
No additional dispute is raised by the nature of the
investment system used by the Oasis entities. Whether
participation is based on a promissory note system as
opposed to direct investing does not affect whether these
entities can be classified as commodity pools. See

Commodity Futures Trading Comm’n v. Collins, No. 94 C 4375,
1997 WL 106135, at *2 (N.D. Ill. Feb. 10, 1997)
(determining that a commodity pool existed even where some
participants were told their transactions were loans).
Instead, the focus is on the aggregation of funds for
trading.
Further, the Oasis entities do not qualify as ECPs.
“[C]ommodity pool[s] in which any participant is not
otherwise an eligible contract participant” cannot be ECPs.
7 U.S.C. § 1a(18)(A)(iv)(II). Therefore, if any of the
participants in the Oasis entities were not ECPs, the pools

themselves do not qualify as ECPs.
No genuine dispute exists regarding whether these
pools included individuals who do not meet the definition
of an ECP. An individual qualifies as an ECP if they
“ha[ve] amounts invested on a discretionary basis, the
aggregate of which is in excess of . . . $10,000,000; or .
. . $5,000,000 and who enters into an agreement, contract,
or transaction in order to manage the risk . . . .” Id. §
1a(18)(A)(xi).
Several of the participants provided sworn testimony
that demonstrates that they do not qualify as an ECP. For

example, Ms. Patti Katter invested $100,000 in the pools,
which was a significant value for her family. (Doc. # 756-8
at 19:7-20:18). Ms. Katter “wanted to invest in something
that [she] knew [she] wouldn't be able to lose the money
because [her family was] in a really big pinch at the
time.” (Id. at 19:2-4). Ms. Katter testified that her
husband had suffered an injury while in the military. (Id.
at 41:8-11). As a result, she was unable to work full-time,
and could not save money for her children’s education, nor
to help them buy cars or provide for their weddings. (Id.
at 41:14-18). The investment was the family’s “little
cushion that was taken from [them].” (Id. at 41:20-22).

Similarly, Mr. Anthony Charles invested $100,000 and
noted that the loss has had a significant impact on his
family. (Doc. # 756-6 at 137:6-138:12). Specifically, he
could no longer send his son to private school and remains
financially impacted by the loss. (Id. at 138:14-23).
Based on these facts, these individuals could not have
had sufficient “amounts invested on a discretionary basis”
to qualify as ECPs. Therefore, neither OIG nor OM is an
ECP. Instead, they are commodity pools subject to the
jurisdiction of the CFTC. See 7 U.S.C. § 2(c)(2)(B)(i)(II)
(“[T]he Commission shall have jurisdiction over[] an

agreement, contract, or transaction in foreign currency
that . . . is offered to, or entered into with, a person
that is not an eligible contract participant . . . .”).
Finally, as part of this argument, DaCorta asserts
that OIG and OM did not engage in retail forex
transactions. (Doc. # 750 at 38). A retail forex
transaction is “any account, agreement, contract or
transaction described in section 2(c)(2)(B) or 2(c)(2)(C)
of the Act.” 17 C.F.R. § 5.1(m). This definition excludes
such transactions “that [are] contract[s] of sale of a
commodity for future delivery . . . that [are] executed,
traded on or otherwise subject to the rules of a contract

market.” Id.
DaCorta has openly acknowledged that he engaged in
forex transactions through OIG and OM. (Doc. # 749 at ¶ 68;
Doc. # 757 at ¶ 68). Additionally, no evidence has been
provided that DaCorta and his entities should be excluded
from the retail forex transaction definition through the
exception regarding contract markets.
The CFTC has jurisdiction over forex transactions. 7
U.S.C. § 2(c)(2)(C)(i)(I). Therefore, the CFTC has
jurisdiction over the Oasis pools and their retail forex
transactions.

B. Commodity Futures Trading Commission’s Motion for
Summary Judgment

The CFTC seeks summary judgment on all counts of the
Amended Complaint: (1) violations of Section 4(b)(a)(2)(A)-
(C) of the Act and Regulation 5.2(b) for forex fraud by
misrepresentations, omissions, false statements, and
misappropriation; (2) violation of Section 4o(1)(A)-(B) of
the Act for fraud and deceit by commodity pool operators
and associated persons of commodity pool operators; (3)
violation of Sections 2(c)(2)(C)(iii)(1)(cc), 4k(2), 4m(1)
of the Act and Regulation 5.3(a)(2) for failure to register
as a commodity pool operator and retail forex commodity

pool operator and associated person of a commodity pool
operator and associated person of retail forex commodity
pool operator; (4) violation of Regulation 4.20(b)-(c) for
failure to receive pool funds in pools’ names and
commingling pool funds; and (5) violation of Regulation
4.21 for failure to provide pool disclosures. (Doc. # 749
at 20). The Court will address each count in turn.
As an initial matter, the Act establishes that a
controlling person of an entity may be liable for that
entity’s violations of the Act if they either “did not act
in good faith or knowingly induced, directly or indirectly,

the act or acts constituting the violation.” 7 U.S.C. §
13c(b). For the CFTC to demonstrate that DaCorta knowingly
induced the violative acts, the agency “must show that the
controlling person had actual or constructive knowledge of
the core activities that make up the violation at issue and
allowed them to continue.” Commodity Futures Trading Comm’n
v. R.J. Fitzgerald & Co., Inc., 310 F.3d 1321, 1334 (11th
Cir. 2002). To qualify, the individual must “possess[],
directly or indirectly, the power to direct or cause the
direction of the management and policies of [the] entity.”
(Doc. # 749 at 31). Given DaCorta’s role as a co-founder,
principal shareholder, and director of OIG, as well as sole

principal and general partner of OM, (Id. at ¶¶ 3, 10; Doc.
# 757 at ¶¶ 3, 10), he qualifies as a controlling person
under this provision and may be held liable for the
violations by these entities, where appropriate. As
discussed below, DaCorta knowingly induced the violations
by OIG and OM and failed to act in good faith through his
intent to defraud. Therefore, he may be held liable for the
violations by the Oasis entities.
1. Forex fraud by misrepresentations,
omissions, false statements, and
misappropriation

In Count I, the CFTC alleges that DaCorta has violated
Section 4b(a)(2)(A)-(C) of the Act, 7 U.S.C. § 6b(a)(2)(A)-
(C), and Regulation 5.2(b), 17 C.F.R. § 5.2(b), by
committing forex fraud by misrepresentations, omissions,
false statements, and misappropriation. (Doc. # 110 at ¶¶
118-29).
Section 4b(a)(2)(A)-(C) provides:
It shall be unlawful . . . for any person, in or
in connection with any order to make, or the
making of, any contract of sale of any commodity
for future delivery, or swap, . . .

(A) to cheat or defraud or attempt to cheat or
defraud the other person;

(B) willfully to make or cause to be made to the
other person any false report or statement or
willfully to enter or cause to be entered for the
other person any false record;

(C) willfully to deceive or attempt to deceive
the other person by any means whatsoever in
regard to any order or contract . . . .

7 U.S.C. § 6b(a)(2)(A)-(C).
Section 4b applies to forex transactions entered into
with non-eligible contract participants. 7 U.S.C. §
2(c)(2)(C)(i), (iv). Therefore, it applies to DaCorta and
his entities.
Regulation 5.2(a)-(b), 17 C.F.R. § 5.2(a)-(b),
similarly prohibits such activity in any retail forex
transactions, such as those conducted by DaCorta.
The CFTC must prove three elements to establish
liability for fraud under Section 4b: “(1) the making of a
misrepresentation, misleading statement, or a deceptive
omission; (2) scienter; and (3) materiality.” R.J.
Fitzgerald & Co., Inc., 310 F.3d at 1328.
The CFTC has established that there is no genuine
dispute of material fact that DaCorta violated both Section
4b and Regulation 5.2(a)-(b).
First, as the jury in the related criminal proceedings
found DaCorta guilty of conspiracy to commit wire fraud and
mail fraud, DaCorta is necessarily precluded from arguing
the elements of scienter and materiality.2

Scienter requires that the “Defendant intended to
defraud, manipulate, or deceive, or [that] Defendant’s
conduct represents an extreme departure from the standards
of ordinary care.” R.J. Fitzgerald & Co., Inc., 310 F.3d at
1328-29. To find DaCorta guilty of conspiracy to commit
mail and wire fraud, the jury must have determined that he
had intent to defraud. See (Doc. # 749-8 at 14, 16)
(including that “the Defendant intended to defraud someone”
as an element of mail and wire fraud).
Further, a misrepresentation, misleading statement, or
deceptive omission is material “if a reasonable investor

2 DaCorta argues that collateral estoppel cannot be applied
in this case as his appeal has not yet been decided. (Doc.
# 757 at 26). However, a pending appeal generally does not
prevent the applicability of collateral estoppel. United
States v. Internat’l Brotherhood of Teamsters, Chauffeurs,
Warehousemen & Helpers of America, 905 F.2d 610, 621 (2d
Cir. 1990).
would consider it important in deciding whether to make an
investment.” R.J. Fitzgerald & Co., Inc., 310 F.3d at 1329.
As above, the jury must have determined that DaCorta’s
false statements were about a material fact. See (Doc. #
749-8 at 14, 16) (including that “the false or fraudulent
pretenses, representations, or promises were about a
material fact” as an element of mail and wire fraud).

Second, there is no genuine dispute of material fact
that DaCorta made “misrepresentation[s], misleading
statement[s], or [] deceptive omission[s].” R.J. Fitzgerald
& Co., Inc., 310 F.3d at 1328.
While DaCorta disputes the CFTC’s use of terms like
“pool participants” and “Oasis pools,” he does not deny the
underlying facts demonstrating that he made
misrepresentations. (Doc. # 757 at ¶¶ 26-29). These facts
include misrepresentations that all funding would be used
in forex trading, participants were guaranteed to “earn a
minimum . . . 12% annually,” the forex trading had been

profitable, no trading risk existed other than systematic
risk, and participants would receive referral fees when
they introduced additional participants. (Doc. # 749 at ¶¶
26-32; Doc. # 165-1 at ¶ 15; Doc. # 757 at ¶¶ 30-32).
Consequently, DaCorta also made several material
omissions, including that only some of the participant
funds were used in forex trading, the pools suffered net
losses, payments to participants were drawn from funds
contributed by other participants, and some funding was
misappropriated to fund DaCorta’s lifestyle. (Doc. # 439 at
6; Doc. # 439-7 at 16-17; Doc. # 749 at ¶¶ 33, 35-41, 49-

52; Doc. # 749-4 at 165:19-167:6; Doc. # 757 at ¶ 41-42).
DaCorta also did not inform participants that he had
previously been barred from trading in a way requiring NFA
registration and that neither he nor the Oasis entities
were registered with the CFTC, retained appropriate
records, nor had the ability to return participants’
principal. (Doc. # 165-1 at ¶ 23.a; Doc. # 749 at ¶¶ 5-7,
9-15, 33-34, 39, 41-43; Doc. # 757 at ¶¶ 5-7, 10, 12-15).
DaCorta further misled participants by
misappropriating funds. He did so by storing participant
funds in an account used for business and personal

expenses, using such funds for these purposes, and paying
participants from funds contributed by other participants.
(Doc. # 4-1 at ¶¶ 44-45, 57; Doc. # 439-7 at 16-17; Doc. #
749 at ¶¶ 16-18, 46-52; Doc. # 749-2 at 153:5-157:13; Doc.
# 757 at ¶ 50).
Therefore, no genuine dispute of material fact exists
that DaCorta violated Section 4b(a)(2)(A)-(C) of the Act.
As Regulation 5.2(b) mirrors Section 4b(a)(2)(A)-(C), the
CFTC has also established that DaCorta violated this
regulation.
2. Fraud and deceit by CPOs and APs of CPOs

In Count II, the CFTC asserts that DaCorta has
violated Section 4o(1)(A)-(B), 7 U.S.C. § 6o(1)(A)-(B), of
the Act by committing fraud and deceit as a CPO and AP of a
CPO. (Doc. # 110 at ¶¶ 130-45).
Section 4o(1) provides:
“It shall be unlawful for a commodity trading
advisor, associated person of a commodity trading
advisor, commodity pool operator, or associated
person of a commodity pool operator, by use of
the mails or any means or instrumentality of
interstate commerce, directly or indirectly—

(A) to employ any device, scheme, or artifice to
defraud any client or participant or prospective
client or participant; or

(B) to engage in any transaction, practice, or
course of business which operates as a fraud or
deceit upon any client or participant or
prospective client or participant.

7 U.S.C. § 6o(1)(A)-(B) (emphasis added). Section
4o(1)(A) requires knowing conduct, while Section
4o(1)(B) does not. Messer v. E.F. Hutton & Co., 847
F.2d 673, 678-79 (11th Cir. 1988).
A commodity pool operator (“CPO”) is defined as:
[A]ny person . . . engaged in a business that is
of the nature of a commodity pool, investment
trust, syndicate, or similar form of enterprise,
and who, in connection therewith, solicits,
accepts, or receives from others, funds,
securities, or property, either directly or
through capital contributions, the sale of stock
or other forms of securities, or otherwise, for
the purpose of trading in commodity interests,
including any—

(I) commodity for future delivery, security
futures product, or swap;

(II) agreement, contract, or transaction
described in section 2(c)(2)(C)(i) of this title
or section 2(c)(2)(D)(i) of this title . . . .

7 U.S.C. § 1a(11)(A)(i)(I)-(II).
Further, a retail forex CPO is “any person who
operates or solicits funds, securities, or property for a
pooled investment vehicle that is not an eligible contract
participant . . . , and that engages in retail forex
transactions.” 17 C.F.R. § 5.1(d)(1).
Additionally, an associated person of a CPO includes:
[A]ny natural person who is associated in any of
the following capacities with: (1) A futures
commission merchant as a partner, officer, or
employee (or any natural person occupying a
similar status or performing similar functions),
in any capacity which involves

(i) The solicitation or acceptance of customers’
orders (other than in a clerical capacity) or
(ii) the supervision of any person or persons so
engaged.

Id. § 1.3.

An AP of a retail forex CPO is defined as:
[A]ny natural person associated with a commodity
pool operator as defined in paragraph (d)(1) of
this section as a partner, officer, employee,
consultant or agent (or any natural person
occupying a similar status or performing similar
functions), in any capacity which involves:

(i) The solicitation of funds, securities, or
property for a participation in a pooled
investment vehicle; or

(ii) The supervision of any person or persons so
engaged.

Id. § 5.1(d)(2).
There is no genuine dispute of material fact that both
OIG and OM were both CPOs and retail forex CPOs. As
discussed above, they both operated commodity pools by
soliciting and receiving funds for pooled trading in
commodity futures. Additionally, they are retail forex CPOs
as they both operated and solicited funding for pooled
investment and engaged in retail forex trading. Further,
neither entity qualifies as an ECP.
Additionally, there is no genuine dispute of material
fact that DaCorta was both an AP of a CPO and an AP of a
retail forex CPO. He solicited and accepted participant
funds on behalf of the Oasis entities. (Doc. # 749 at ¶ 68;
Doc. # 749-3 at 205:4-11, 206:8-15; Doc. # 757 at ¶ 68).
Therefore, no genuine dispute of material fact exists
that, by engaging in a scheme to defraud current and
potential participants, DaCorta violated Section 4o(1)(A)-
(B). DaCorta acted with intent to defraud participants and
actually did defraud them through his work with OIG and OM,

causing millions of dollars in losses. (Doc. # 749-8 at 14,
16).
3. Failure to register as a CPO and retail
forex CPO and AP of a CPO and AP of retail
forex CPO
In Count III, the CFTC asserts that DaCorta has
violated Sections 2(c)(2)(C)(iii)(1)(cc), 4k(2), 4m(1) of
the Act, 7 U.S.C. §§ 2(c)(2)(C)(iii)(1)(cc), 6k(2), 6m(1),
and Regulation 5.3(a)(2), 17 C.F.R. § 5.3(a)(2), by failing
to register as a CPO and retail forex CPO and AP of a CPO
and AP of retail forex CPO. (Doc. # 110 at ¶¶ 146-65).
The Act and supporting regulations require that CPOs,
retail forex CPOs, APs of CPOs, and APs of retail forex
CPOs register as such. 7 U.S.C. § 6m(1) (establishing a
registration requirement for CPOs); 17 C.F.R. §
5.3(a)(2)(i) (similar for retail forex CPOs); 7 U.S.C. §
2(c)(2)(C)(iii)(I)(cc) (establishing a registration
requirement for APs of CPOs); Id. § 6k(2) (similar); 17
C.F.R. § 5.3(a)(2)(ii) (similar for APs of retail forex
CPOs).
As discussed above, there is no genuine dispute of
material fact that OIG and OM were CPOs and retail forex
CPOs. Nor is there any similar dispute as to whether
DaCorta was an AP of CPOs and retail forex CPOs.

DaCorta admits that neither OIG nor OM was registered
as a CPO or a retail forex CPO. (Doc. # 749 at ¶¶ 7, 12;
Doc. # 757 at ¶¶ 7, 12). Additionally, he admits that he
was not registered as an AP of a CPO or retail forex CPO.
(Doc. # 749 at ¶ 5; Doc. # 757 at ¶ 5). Therefore, the CFTC
has met its burden of proof regarding this count.
4. Failure to Receive Pool Funds in Pools’
Names and Commingling Pool Funds
In Count IV, the CFTC asserts that DaCorta has
violated Regulation 4.20(b)-(c), 17 C.F.R. § 4.20(b)-(c),
by failing to receive pool funds in pools’ names and
commingling pool funds. (Doc. # 110 at ¶¶ 166-73).
Regulation 4.20(b) provides that “[a]ll funds,
securities or other property received by a commodity pool
operator from an existing or prospective pool participant
for the purchase of an interest or as an assessment
(whether voluntary or involuntary) on an interest in a pool
that it operates or that it intends to operate must be
received in the pool’s name.” 17 C.F.R. § 4.20(b).
Regulation 4.20(c) provides that “[n]o commodity pool
operator may commingle the property of any pool that it
operates or that it intends to operate with the property of
any other person.” Id. § 4.20(c). These regulations apply

to anyone who is required to register as a CPO. Id. § 5.4.
The Oasis entities did not receive participant funds
in the names of the pools. (Doc. # 4-1 at ¶ 30).
Additionally, the pools’ property was commingled with the
property of others. (Id. at ¶¶ 44-45, 57; Doc. # 749 at ¶
50; Doc. # 749-2 at 153:5-157:13; Doc. # 757 at ¶ 50).
Therefore, no genuine dispute of material fact exists
that OM and OIG violated these provisions.
5. Failure to Provide Pool Disclosures
In Count V, the CFTC asserts that DaCorta has violated
Regulation 4.21, 17 C.F.R. § 4.21, by failing to provide
pool disclosures. (Doc. # 110 at ¶¶ 174-80).

Regulation 4.21 provides:
[E]ach commodity pool operator registered or
required to be registered under the Act must
deliver or cause to be delivered to a prospective
participant in a pool that it operates or intends
to operate a Disclosure Document for the pool
prepared in accordance with §§ 4.24 and 4.25 by
no later than the time it delivers to the
prospective participant a subscription agreement
for the pool.

17 C.F.R. § 4.21.

This regulation applies to anyone required to register
as a CPO under provisions relating to forex transactions.
See Id. § 5.4.
No genuine dispute of material fact exists that OIG
did not provide disclosures to potential participants as
required by Regulations 4.24 and 4.25. See (Doc. # 454 at
34-45) (excluding such disclosures from documents provided
to potential participants). Therefore, the CFTC has carried
its burden regarding this count.
IV. Remedies
The CFTC has requested (1) injunctive relief, (2)
restitution, and (3) a civil penalty to be leveraged
against DaCorta. Considering the facts of this case, the
Court determines it is appropriate to award all three forms
of relief.
A. Injunctive Relief
The CFTC requests that the Court enter a permanent
injunction against DaCorta pursuant to Section 6c(a) of the
Act, 7 U.S.C. § 13a-1(a). This provision states that the
CFTC may bring suit to enjoin violations of the Act and its
supporting regulations, as well as enforce compliance with
such rules, when it appears that a person “has engaged, is
engaging, or is about to engage in any act or practice
constituting a violation of any provision of this chapter
or any rule, regulation, or order thereunder.” Id. “Upon a
proper showing, a permanent or temporary injunction or

restraining order shall be granted without bond.” Id. §
13a-1(b).
A court may issue a statutory injunction under this
provision based only on “[a] prima facie case of
illegality;” the CFTC does not need to prove “irreparable
injury or the inadequacy of other remedies.” Commodity
Futures Trading Comm’n v. Muller, 570 F.2d 1296, 1300 (5th
Cir. 1978). To determine the appropriateness of an
injunction, the Court focuses on “whether the defendant’s
past conduct indicates that there is a reasonable
likelihood of further violations in the future.” Commodity

Futures Trading Comm’n v. Wilshire Inv. Mgmt. Corp., 531
F.3d 1339, 1346 (11th Cir. 2008) (quoting SEC v.
Caterinicchia, 613 F.2d 102, 105 (5th Cir. 1980)).
The Court considers several factors in this analysis.
The primary factor is the defendant’s past illegal conduct.
Id. However, the Court also considers (1) “[t]he
egregiousness of the defendant’s actions,” (2) whether the
violation was isolated or recurrent, (3) “the degree of
scienter involved,” (4) “the sincerity of the defendant’s
assurances against future violations,” (5) the defendant’s
recognition that his conduct was wrongful, and (6) “the
likelihood that the defendant’s occupation will present

opportunities for future violations.” Id. (quoting SEC v.
Carriba Air, Inc., 681 F.2d 1318, 1322 (11th Cir. 1982)).
This determination is made based on the totality of the
circumstances. Commodity Futures Trading Comm’n v. Altamont
Global Partners, LLC, No. 6:12-cv-1095-GAP-TBS, 2014 WL
644693, at *11 (M.D. Fla. Feb. 19, 2014).
Here, the Court determines that it is appropriate to
permanently enjoin DaCorta from further violations of the
Act and supporting regulations, as well as from other
activities that would present opportunities for further
violations. Each of the factors weighs in favor of granting

an injunction, and the severity of DaCorta’s violations
justify a permanent injunction.
As the above discussion highlights, DaCorta violated
multiple provisions of the Act and its supporting
regulations. In doing so, he harmed over 800 participants
and caused at least $53,270,336.08 in damages. (Doc. # 165-
1 at ¶ 12; Doc. # 749-12 at 7-8). Additionally, given
DaCorta’s role in OIG and OM (Doc. # 749 at ¶¶ 3-4, 8, 10;
Doc. # 757 at ¶¶ 3-4, 8, 10), he played a significant role
in shaping the actions of those entities. DaCorta’s actions
persisted over the course of OIG and OM’s operations and
his actions were at least reckless, if not willful. E.g.,

(Doc. # 749-8 at 14, 16). Additionally, DaCorta maintains
that he is not liable for this conduct. E.g., (Doc. # 757
at ¶ 57) (“DaCorta admits he was found guilty beyond a
reasonable doubt but strongly denies he is in fact guilty
of such offense. DaCorta specifically testified he did not
intend to deceive or cheat investors . . . .”).
Additionally, these violations occurred despite a 2010
settlement under which DaCorta agreed not to engage in
activities requiring NFA registration. (Doc. # 749 at ¶ 5;
Doc. # 757 at ¶ 5).
The Court therefore enjoins DaCorta from directly or

indirectly violating the Act and its supporting regulations
by:
•
Cheating or defrauding, or attempting to cheat or
defraud, other persons in or in connection with any
order to make, or the making of, any contract of sale
of any retail forex transaction that is made, or to be
made, for or on behalf of, or with, any other person,
in violation of Section 4b(a)(2)(A)–(C) of the Act, 7
U.S.C. § 6b(a)(2)(A)–(C), and Regulation 5.2(b)(1)-
(3), 17 C.F.R. § 5.2(b)(1)-(3);
•
Employing any device, scheme, or artifice to defraud
any client or participant or prospective client or
participant, or engaging in any transaction, practice
or course of business which operates as a fraud or
deceit upon any client or participant or prospective
participant in violation of Section 4o(1)(A)–(B) of
the Act, 7 U.S.C. § 6o(1)(A)–(B);
•
Being associated with a CPO as a partner, officer,
employee, consultant, or agent, or a person occupying
a similar status or performing similar functions, in
any capacity that involves the solicitation of funds,
securities, or property for participation in a retail
forex pool without being registered with the CFTC as
an AP of the CPO, in violation of Sections
2(c)(2)(C)(iii)(I)(cc) and 4k(2) of the Act, 7 U.S.C.
§§ 2(c)(2)(C)(iii)(I)(cc), 6k(2), and Regulation
5.3(a)(2), 17 C.F.R. § 5.3(a)(2);
•
Failing to operate a commodity pool as an entity
cognizable as a legal entity separate from that of the
pool operator, in violation of Regulation 4.20(a)(1),
17 C.F.R. § 4.20(a)(1);
•
Failing to require that all funds, securities, or
other property received by a CPO from a prospective or
existing pool participant be received in the commodity
pool’s name, in violation of Regulation 4.20(b), 17
C.F.R. § 4.20(b);
•
Commingling the property of a commodity pool in
violation of Regulation 4.20(c), 17 C.F.R. § 4.20(c);
and
•
Failing to provide prospective pool participants with
pool disclosure documents in the form specified in
Regulations 4.24 and 4.25, 17 C.F.R. §§ 4.24, 4.25, in
violation of Regulation 4.21, 17 C.F.R. § 4.21.
The Court further enjoins DaCorta from directly or
indirectly:
•
Trading on or subject to the rules of any registered
entity (as that term is defined in Section 1a(40) of
the Act, 7 U.S.C. § 1a(40));
•
Entering into any transactions involving “commodity
interests” (as that term is defined in Regulation 1.3,
17 C.F.R. § 1.3), for his own personal account or for
any account in which he has a direct or indirect
interest;
•
Having any commodity interests traded on his behalf;
•
Controlling or directing the trading for or on behalf
of any other person or entity, whether by power of
attorney or otherwise, in any account involving
commodity interests;
•
Soliciting, receiving, or accepting any funds from any
person for the purpose of purchasing or selling any
commodity interests;
•
Applying for registration or claiming exemption from
registration with the CFTC in any capacity, and
engaging in any activity requiring such registration
or exemption from registration with the CFTC, except
as provided for in Regulation 4.14(a)(9), 17 C.F.R. §
4.14(a)(9); and
•
Acting as a principal (as that term is defined in
Regulation 3.1(a), 17 C.F.R. § 3.1(a)), agent or any
other officer or employee of any person (as that term
is defined in Section 1a(38) of the Act, 7 U.S.C. §
1a(38)), registered, exempted from registration or
required to be registered with the CFTC except as
provided for in 17 C.F.R. § 4.14(a)(9).
B. Restitution
Section 6c(d)(3) also permits the award of equitable
remedies including “restitution to persons who have
sustained losses proximately caused by such violation (in
the amount of such losses).” 7 U.S.C. § 13a-1(d)(3)(A); see
also Smithers, 2013 WL 4851684, at *11 (calculating
restitution based on the “amount of customer losses”).
The related criminal proceeding determined that
DaCorta’s actions resulted in at least $53,270,336.08 of
loss. (Doc. # 749-12 at 7-8). Therefore, the Court

determines that DaCorta shall pay $53,270,336.08 plus post-
judgment interest.
C. Civil Penalty
Section 6c also provides for the award of civil
penalties. 7 U.S.C. § 13a-1(d). Violations committed
between October 23, 2012, and November 1, 2015, may not
exceed the greater of $140,000 or “triple the monetary gain
to the person for each violation.” Id. § 13a-1(d)(1)(A); 17
C.F.R. § 143.8(b)(1). Violations committed after November
2, 2015, may not exceed the greater of $214,514 or “triple
the monetary gain to the person for each violation.” 7 §
U.S.C. 13a-1(d)(1)(A); 17 C.F.R. § 143.8(b)(1).

To determine the appropriate value of a civil penalty,
courts have considered “the general seriousness of the
violation,” including whether the violation was of a core
provision of the Act and whether scienter existed, as well
as any aggravating or mitigating circumstances. Wilshire
Inv. Mgmt. Corp., 531 F.3d at 1346. Additionally, courts
consider the consequences of the violations and harm to
both consumers and the market. U.S. Commodity Futures
Trading Comm’n v. Gutterman, No. 12-21047-CIV, 2012 WL
2413082, at *10 (S.D. Fla. June 26, 2012). Penalties must
be “rationally related to the offense charged or the need

for deterrence.” U.S. Commodity Futures Trading Comm’n v.
Levy, 541 F.3d 1102, 1112 (11th Cir. 2008). Courts often
calculate monetary gain by subtracting funds paid to
customers and trading losses from the total value provided
by participants into a fund. E.g., Smithers, 2013 WL
4851684, at *12 n.5.
The CFTC has requested that the Court award the
maximum civil penalty under this provision. Specifically,
they requested that the Court award $8,453,628.48, or three
times the monetary gain to DaCorta from his conduct. (Doc.
# 749 at 41). The CFTC used the criminal judgment to

estimate monetary gain, as it held that “at least
$2,817,876.16 in proceeds was obtained and dissipated by
[DaCorta] from the wire fraud and mail fraud conspiracy and
the money laundering offense, for which he was convicted.”
(Doc. # 749-12 at 9).
The Court agrees that this severe civil penalty is
justified in this case. By defrauding participants, DaCorta
violated core provisions of the Act. See Wilshire Inv.
Mgmt. Corp., 531 F.3d at 1346 (“Defrauding customers is a
violation of the core provisions of the CEA and ‘should be
considered very serious.’” (citation omitted)). He also did

so knowingly and repeatedly. (Doc. # 749-8 at 14, 16).
DaCorta has not accepted responsibility for his actions and
still denies that he violated the law. See generally (Doc.
# 750) (denying that DaCorta is liable based on any of the
counts alleged). Further, DaCorta committed these
violations while already bound by a 2010 settlement that
prohibited him “from trading in any capacity that would
require registration with the NFA.” (Doc. # 749 at ¶ 6).
Therefore, the Court determines that a strong penalty is
warranted here to both account for the severity of
DaCorta’s conduct and provide sufficient deterrence for
future violations.
V. Conclusion

The Court grants summary judgment in favor of the CFTC
on all counts. The CFTC has demonstrated that there is no
genuine dispute of material fact regarding these claims,
both as to whether DaCorta individually can be held
responsible for the violations and whether he can be held
liable for OIG and OM’s violations pursuant to Section 13b
of the Act. Because the CFTC is entitled to summary
judgment, the Court also denies DaCorta’s Motion.
Accordingly, it is now
ORDERED, ADJUDGED, and DECREED:

(1) Plaintiff Commodity Futures Trading Commission’s
Motion for Summary Judgment Against Defendant Michael
J. DaCorta (Doc. # 749) is GRANTED.
(2) Defendant Michael J. DaCorta’s Motion for Summary
Judgment on Behalf of Defendant Michael J. DaCorta
(Doc. # 750) is DENIED.
(3) The Clerk is directed to enter judgment in favor of
the CFTC and against Defendant Michael J. DaCorta on
all counts of the complaint in the amount of
$53,270,336.08 plus post-judgment interest as

restitution and $8,453,628.48 as a civil penalty.
Additionally, DaCorta is permanently enjoined from
further violations of the Commodities Exchange Act and
supporting regulations, and actions presenting
opportunities for future violations, as described in
this Order. The Clerk is directed to include the
language of the permanent injunction, as stated on
pages 37-41 of this Order in the Judgment.
(3) In light of this Order, Defendant Michael J. DaCorta’s
Petition for Writ of Habeas Corpus ad Testificandum
(Doc. ## 769, 770) is DENIED.

(4) The Clerk is directed to CLOSE the case.
DONE and ORDERED in Chambers in Tampa, Florida, this
6th day of December, 2023.
fai Ir. Munaby (noe¥
VIR! TA M. HERNANDEZ’*COVINGTON
UNITED STATES DISTRICT JUDGE

46

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10114662. Public record. Not legal advice.