EmpiresX, currently
under Receivership
as Empires Consulting, has settled commodities fraud charges with the CFTC.

The proposed settlement against Empirex details a permanent injunction and $32.1 million civil monetary penalty.

Specific fraud charges brought by the CFTC against Empires Consulting and individual defendants Emerson Pires, Flavio Goncalves and Joshua Nicholas include:

fraud

failure to register as a commodity pool operator

fraud and deceit by a commodity pool operator

commingling funds by a commodity pool operator

A March 13th filed joint motion requesting settlement approval  stipulates an injunction, prohibiting Empires Consulting from committing further commodities related acts of fraud.

With respect to restitution and a civil monetary penalty, Empires Consulting has consented to a $32,178,397 civil monetary penalty and another $32,178,397 in restitution.

Last May EmpiresX, again as Empires Consulting,
settled parallel securities fraud charges with the SEC
for the same $32.1 million amount.

Following their
respective indictments
in 2022, Emerson Pires and Flavio Goncalves remain at large. A
$45.8 default judgment
was ordered against the pair in June 2023.

Following his arrest and subsequent
guilty plea
, Joshua Nicholas was
sentenced to 51 months
in November 2022.

Nicholas received a
$300,026 judgment
in the SEC’s parallel proceedings. In the CFTC case, Nicholas entered into settlement negotiations back in April 2023.

As per a March 6th filing requesting a stay on CFTC proceedings against him, Nicholas, as the referenced defendant in the filing, wrote;

On or around June 1, 2023, CFTC prepared, and sent, inter alia, drafts of a settlement agreement , and a consent order to Defendant with a return envelope and paid-for postal label.

However, the documents, including the draft settlement agreement, were never returned by Defendant.

[In a recent conversation with a CFTC attorney] Defendant explained … that he previously, in fact, had been ready to sign and send back the draft settlement agreement but had been prevented from doing so because a prison guard—without rhyme or reason—maliciously tore up the postal label needed to return the documents in front of of his face.

As a result of the prison guard’s alleged conduct, Nicholas requested a stay so he may resume settlement proceedings with the CFTC.

The court granted Nicholas’ motion on March 7th, requiring a Status Report be filed by June 5th.

At time of publication, a decision on the Empires Consulting CFTC settlement remains pending.

Update 6th April 2024 – 
The court approved the CFTC’s EmpiresX settlement on March 15th.

Update 6th February 2025 – 
The CFTC has secured an
additional $129 million judgment
against Emerson Pires, Flavio Goncalves and Joshua Nicholas.

🤖 Quick Answer

What were the main charges brought by the CFTC against EmpiresX?
The CFTC charged EmpiresX and its operators with fraud, failure to register as a commodity pool operator, fraud and deceit by a commodity pool operator, and unlawful commingling of client funds. These violations involved operating an unregistered commodities scheme that defrauded investors.

What penalties did EmpiresX face in the CFTC settlement?
EmpiresX agreed to pay $32.1 million in civil monetary penalties and $64.3 million total in the settlement. The company received a permanent injunction prohibiting it from engaging in further commodities-related fraudulent activities.

Who were the individual defendants named in the case?
The CFTC named three individuals as defendants: Emerson Pires, Flavio Goncalves, and Joshua Nicholas

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