Stunning new development in the Capital Blu Forex Case !!!

The prominent forensic accounting and consultancy firm Lewis B Freeman has been placed into receivership. So who is Lewis B Freeman.
This was the firm which was appointed receiver for Capital Blu Management, which is the Donavon Davis Jr. led forex trading outfit which ripped off its clients almost US$17M dollars.
The receiver in his last report in May 2009 had then indicated that it had only found approx. $500k and that a significant amount funds were spent on sleaze, booze, vacation and rental.

Lewis B freeman itself has now been placed into receivership as the authorities recently raided the firm trying to trace us$3.6m which is said to be held by the firm.
This is a stunning new development, and the question is can Capital Blu clients now throw in the towel at this stage.

Read more here.

http://www.law.com/jsp/article.jsp?id=1202434695199&pos=ataglance

Investforlife & HYIP Programs one year later

May 2009 marks  roughly one year since this blog started, and it is interesting the turn of events.  It has been a most interesting year as the details of the Alternative Investment Schemes(AIS)/Un-regulated Financial ORganisations(UFO)  came out. It was however sad to see and hear the stories of persons deceived and deluded, some even to this day.

While there were others, the following persons, Jason, Nocotec, Jay, Robin Irie,  JohnDoe, DaveSin  were particular targets of harsh criticism for the daring to call the HYIPs Scams. So reviled was this group that were driven from a site (blog) that will remain nameless but it is now known as the #4 bus.  Interestingly, it was the suggestions of some of the posters on that blog that resulted in the formation of this blog. 

Their suggestion was taken and investforlife.wordpress.com was born. One year later, having been featured on NationWide, CVM TV, mentioned indirectly by Observer writers, and over 950,000 page views, Investforlife remains while may UFOs have died along with many supporting websites.

Here is the list of the some ‘programs’ or ‘clubs’ and their prognosis.

  1. Cash Plus – Dead. CEO arrested and charged.
  2. WorldWise  – Dead.
  3. May Daisy – Dead. Anyone knows where the CEO is?
  4. Olint – Dead. CEO arrested and charged.
  5. Capital Blu – Dead  CEO arrested and charged.
  6. TCI FX – Dead.
  7. CARIEF – Bedridden.
  8. Higgins Warner – Dead.

Feeder Clubs – Dead

  1. Lewfam (Jamaica) – Dead
  2. SGL Holdings(Grenada) – Dead 
  3. KUI(Jamaica) – Dead
  4. Wealthbuilders(Jamaica) – Dead
  5. UWIN(Antigua) – Dead
  6. Vision Increase(Panama) – Dead
  7. Regency International(Florida) – Dead. CEO arrested
  8. F1 Investments(Florida) – Dead. Filed lawsuit against May Daisy
  9. Willshaw(St. Lucia) – Dead
  10. RKR Funds – Dead.

Some sites where the predominate theme appeared  to be the defense of the UFOs have also died or changed focus. We congratulate those that allowed the contrary fews to posted.

  1. jamaicainvestmentwatch.com (dead)
  2. cashplusinvestment.com (refocussed)
  3. http://www.highyieldsource.com/forum (in need of cleaning up, controlled by spammers)
  4. wealthmax.wordpress.com – remains for the record.

Thanks to all the contributors that have kept this blog going, despite the challenges. May this experience be a lesson to us. Think and check before you invest.

Capital Blu CEO charged for fraud

Investforlife has just received news that Capital Blu CEO , Donovan Davis Jr, has been charged for fraud in Florida.

It has been reported that Mr Davis at times would blow, over US$40,000 in one night in a gentleman’s club.

In addition we are receiving word that he would travel on a regular basis via charter flights.

We will update this post as soon as we have more information, so stay tuned.

Links

Hot Shot Traders or Con Artistes

Just a few days before the  anniversary of a hot article appearing in the Jamaica Observer on January 25, 2008, we continue to warn people, careful where you put your money.  In this article in the Jamaica Observer, Al Edwards, referred to three Hot Shot traders.  Here is an interesting now questionable quote about David Smith.

Perhaps the best-known and now renowned FX trader to come onto the scene in recent years is David Smith of Olint. For seven years he worked as a licensed representative of Jamaica Money Market Brokers (JMMB) specialising in international FX trading under the guidance of both Keith Duncan and Julian Mair.

The question now on many thinking persons minds was David Smith(OLINT) or Donavan Davis JR.(Capital Blu) really trading at all?

We encourage people to be very careful were you put your money.  Everybody is potentially open to being scammed  or conned but make every effort to avoid it.  Do not ignore the warning signs!

  • If it is too true to believe it probably is?
  • Is the operations transparent ?
  • Is it open to regulation, (yea we know of Madoff, but if they don’t want to be regulated stay far away)?
  • Do you know how the investment will make money?

By June of  2008, Al Edwards, had to be singing a new tune.

It may also be the case that having paid out anticipated returns to his club members, and with no new money coming in; he was caught between a rock and a hard place. Then again, the question has been posed: Was he fully engaged in foreign currency trading, or were there detrimental lapses?

What do you think?

Related:

NFA wants information from Capital Blu investors

The trouble for Capital Blu does not end with its reported 90% loss. The NFA a notice issued on September 12, 2008 is asking if persons have done business with Capital Blu Management LLC, Blayne Davis, Donovan Davis, Damien Bromfield, among others, please contact them. This is not a good sign for Capital Blu.  

Notice I-08-23

September 12, 2008

Request for Information

Please contact NFA Manager Heather Johnson at (312) 781-1554 (hjohnson@nfa.futures.org) or NFA Compliance Director Ed Dasso (312) 781 -1551 (edasso@nfa.futures.org) immediately if you ever transacted business with, currently carry or have carried any accounts (including joint accounts) in the name of, or controlled by, any of the following individuals or entities:

Capital Blu Management LLC
CBM FX Fund LP
Damien Bromfield (Capital Blu Principal)
Blayne Davis (Capital Blu Principal)
Donovan Davis (Capital Blu Principal)
Joseph T Cavallaro
Christopher Shane Clausen
Nakano Capital Partners LP
Nakano Capital Advisors LLC
Nakano Capital Management LL

Capital Blu was never registered locally by the FSC and the FSC rightly warned and placed them on the list of UFOs. It now brings into question whether a merger with OLINT, as mentioned by Peter Bovell in his interview on Nationwide News Network, would have made a difference . The NFA is yet to respond to the response provided by I Trade FX to its complaint, in which OLINT figured prominently.

Source:

Capital Blue in a mess

Capital Blu is trouble. After reporting a fantastic 57% in one month earlier in the year, things gone in the opposite  direction. Some managers have been allegedly removed and a maximum drawdown of 15% has been imposed.

See letter. A few person on this blog had questioned the auditors being used. 

Capital Blu Investors Suffer 90% Losses.
Dear Capital Blu Clients,

In Mid-July we commenced trading at Saxo Bank and began running parallel programs with PFG. While both programs were utilizing the same exact strategy and held essentially the same positions; our trading team began noticing significant differences in the platforms. Some of the key differences were:

  •  Quoted Rates with inflated spreads on both platforms.
  •  PFG required margin on net position; Saxo Bank required margin on gross positions.
  •  PFG portfolio could be managed through a single master account; Saxo Bank’s portfolio had to be managed by each individual account.

What appeared to be manageable challenges on both platforms unfortunately were exaggerated on August 8th when the market made a dramatic trend reversal.

On the Saxo platform margin calculations which were averaging around 20% rose to over 100+% (extremely abnormal). Our trading team immediately began rebalancing the portfolio to reduce margin, however, due our inability to rebalance the entire group of managed accounts at one time we had a few clients get stopped out resulting in catastrophic losses. The accounts that were still below the 150% threshold had to be managed independently which ultimately compromised the trading strategy. Over the course of the next several weeks our trading team worked to rebalance each individual portfolio, however, since we were forced to unload positions based on necessity we were left with very few favorable positions and ultimately saw the entire managed account portfolio stopped out for approximately an 80-90% lose in every account.
We truly understand the frustration of each and every customer and wish there were something more that we could have done prior. In hindsight there were several actions we would do differently; however, this isn’t a time for what ifs as you deserve a plan for how we are going to move forward.

So the question many of you are asking of Capital Blu is where we go from here. Well first and foremost, you have our commitment that we will do everything commercially, legally and ethically possible to rebuild each and every client’s account.
Internally, we have taken the following actions:

  • Blayne Davis, Director of Portfolio Management is no longer a member of the Capital Blu.
  • Implementation of formal risk management procedures to ensure a client’s max drawdown is 15% regardless of trader, platform, strategy, etc.
  • Indefinite suspension of the BluFX Options Benchmark Managed Account Program.

Proposed Reparation:
While we understand that many of you are looking for us to simply cut a check to reimburse the losses, we have been advised by our legal team that we cannot commercially offer this type of reparation. As per the program disclosure, Capital Blu Management will honor the high watermark of the August 1, 2008 balance for all clients in the BluFX Options Program. In essence, we will rebuild each and every account free of any commissions or performance fees until we have brought the account balance back to the August 1, 2008 balance.

Kind Regards,

Joe Mills | Director of Sales & Marketing
Capital Blu Management LLC