The Financial Industry Regulatory Authority (FINRA) recently filed a cease-and-desist order against Success Trade Securities. Allegedly the online investment firm scammed its investors, which included a number of professional athletes.
FINRA issued a complaint against Success Trade and its CEO and President, Fuad Ahmed, accusing fraud in the sales of $18 million in notes issued by the firm's parent company, Success Trade Inc.
FINRA claims the firm, which operates through Just2Trade and LowTrades, Ahmed, and other representatives, sold more than $18 million in notes to 58 investors, many of whom are current or former NFL and NBA players. However, the company claimed they were raising just $5 million even after sales significantly exceeded the original offering, FINRA said.
The firm and Ahmed failed to disclose the company's amount of existing debt, and the fact that it would be unable to make future interest payments without raising more money from new investors, FINRA said. Success Trade Securities also misrepresented how the proceeds would be used and improperly used the funds to make loans to Ahmed and interest payments to existing investors, according to FINRA.
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