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Worth Asset Management, LLC
Phone: (561) 833-7227 (Disconnected)
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324 Datura St., #207
West Palm Beach, FL 33401-5533(561) 833-7227
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Industry Tips for Gold, Silver, and Platinum DealersInvestor Alert! Beware of Companies Offering Quick Riches Selling Precious Metals and Other Commodities
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As of February 18, 2014, Case CFTC Docket No. 14-07, The U.S. Commodity Futures Trading Commission (CFTC) today filed and settled charges against Worth Asset Management LLC (Worth Asset) of West Palm Beach, Florida, and its sole owner and manager, Paul L. Kaulesar of Royal Palm Beach, for solicitation fraud and engaging in illegal, off-exchange precious metals transactions.
Neither Worth Asset nor Kaulesar has ever been registered with the CFTC.
The CFTC Order requires Worth Asset and Kaulesar jointly to pay a $1,565,000 civil monetary penalty and restitution to their customers totaling $4,696,640. The Order also imposes permanent trading and registration bans against Worth Asset and Kaulesar and prohibits them from violating the provisions of the Commodity Exchange Act and a CFTC Regulation, as charged.
The Order finds that, between July 16, 2011 and March 31, 2013, Worth Asset and Kaulesar operated a telemarketing firm that solicited individual retail customers to enter into financed precious metals transactions in gold, silver, and platinum. The large majority of their transactions involved the sale of leveraged silver contracts to unsophisticated investors purchasing physical metals by paying as little as 20 percent of the total price and receiving a loan for the balance of the transaction, according to the Order. Customers were also charged a 15 percent commission on the total leveraged value of the metal transaction, as well as monthly interest, according to the Order.
However, according to the Order, Worth Asset and Kaulesar did not purchase physical commodities on the customers' behalf. Rather, they aggregated the customer payments received, transferred a portion of those funds to their margin trading account, and made book entries in an electronic database reflecting the customer transaction details. During the period, Worth Asset and Kaulesar received $4,696,640, the difference between the funds that customers sent to them and what they returned to customers, the Order also finds.
The precious metals transactions offered by Worth Asset and Kaulesar were illegal contracts because they were not executed on or subject to the rules of a board of trade, exchange, or contract market, as required by the Commodity Exchange Act, according to the Order.
Worth Asset and Kaulesar defrauded customers and potential customers by misrepresenting the potential profits from leveraged precious metals contracts and failing to disclose the past performance of the precious metals contracts they offered, the Order finds. One piece of their promotional material, for example, emphasized the profits that could purportedly be obtained through precious metals transactions, claiming that "(r)enowned precious metals analyst, (name omitted), predicts Silver to top $60 an ounce by the end of 2012." However, Worth Asset and Kaulesar failed to inform customers that at least 88 percent of the firm's customers lost money on their financed precious metals investments.
For further assistance please contact the
Commodity Futures Trading Commission
Three Lafayette Centre
1155 21st Street, NW
Washington, DC 20581
Consumer Assistance and Complaints:
Call Toll-Free 1-866-FON-CFTC (866-366-2382).