U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 22939 / March 12, 2014
United States v. Craig A. Karlis, et al., No. 1:10-cr-10319 (D. Mass. October 6, 2010)
Securities and Exchange Commission v. Boston Trading and Research, LLC, et al., Civil Action No. 1:10-cv-11841 (D. Mass. October 28, 2010)
Former Owner of a Massachusetts-Based Trading Company Pleads Guilty to Multi-Million Dollar Fraud Scheme
The Securities and Exchange Commission announced today that on March 7, 2014, the former owner of Massachusetts-based Boston Trading and Research, LLC (BTR), pled guilty to charges stemming from his role in an investment scheme that defrauded more than 1,000 investors out of more than $30 million.
Craig A. Karlis, 53, of Hopkinton, MA, pled guilty before U.S. District Court Senior Judge Mark L. Wolf, to nine counts of wire fraud and two counts of filing false tax documents. His sentencing is currently scheduled for June 2, 2014 at 3:00 p.m. His business partner, Ahmet Devrim Akyil, 41, formerly of Hingham, MA, was charged with 10 counts of wire fraud. According to a March 7, 2014 press release issued by the United States Attorney’s Office for the District of Massachusetts (USAO), Akyil left the United States for Turkey in 2009 and remains a fugitive. The USAO unsealed an indictment charging Karlis and Akyil with criminal violations on October 28, 2010.
Also on October 28, 2010, the Commission filed a civil injunctive action in federal district court in Massachusetts against BTR, and its principals Ahmet Devrim Akyil and Craig Karlis for fraudulently raising millions of dollars from investors in a purported foreign currency (Forex) trading venture. Among other things, the Commission alleges that the defendants misappropriated some investor funds and lost the vast majority of remaining investor funds through Forex trading activity after promising investors that most of their funds were protected from such trading losses.
According to the Complaint, BTR collapsed in September 2008 due to significant losses accrued as a result of concealed trading far past the stop loss limits promised to investors. Ultimately, BTR distributed the remaining funds, which accounted for only approximately 10% of account balances, to its investors.
The Commission’s complaint, which is pending, alleges that BTR, Akyil, and Karlis violated Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933, and Sections 10(b) and 15(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The Commission seeks the entry of a permanent injunction, disgorgement of ill-gotten gains plus pre-judgment interest, and the imposition of civil monetary penalties against BTR, Akyil, and Karlis.