CFTC v. 4X Solutions, Chay (ponzi schemes, 2013)

Judgment entered

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In April 2013 the CFTC charged New York forex firm 4X Solutions, Inc. and its principal Whileon Chay in the Southern District of New York with fraud and misappropriation in a $4.8 million Ponzi scheme. The court entered a default judgment and injunction on April 17, 2015, and on January 29, 2016 ordered them jointly and severally to disgorge $2,745,226 and pay an $8,235,678 penalty.

The record

What was ordered

Civil penalty

$8.2m

Disgorgement

$2.7m

Prejudgment interest

—

Total relief

$11m

Alleged gain

—

A dash means the release did not state a figure we could extract, not that the figure is zero. Penalty and disgorgement are stored separately so aggregates across the library do not double-count the same dollars.

What is alleged to have happened

The complaint alleged the defendants solicited about $4.8 million from at least 19 pool participants by promising returns of 24 to 36 percent a year. It alleged Chay lost about $2 million trading, misappropriated about $2.8 million to fund the firm and his own spending, and issued false statements, with purported returns paid from other participants' principal.

Outcome. According to the CFTC's February 8, 2016 release, Judge Richard Berman entered a default judgment and permanent injunction against both defendants on April 17, 2015, finding that they fraudulently solicited $4.8 million, and referred the amount of relief to a magistrate judge. On January 29, 2016 he adopted the recommendation and ordered disgorgement of $2,745,226 and a civil monetary penalty of $8,235,678, three times the misappropriated amount, joint and several. The release does not state whether restitution was ordered or whether any money was collected, and it warns that such orders may not result in recovery. This was a default, so the findings were not contested by the defendants.

This library tags the matter as ponzi schemes because the document describes payments to earlier participants made from later participants' money. The tagging is ours, not the regulator's: agencies charge statutory provisions, not technique names.

What technique is this, and how does it work?

This action is tagged with one technique in our taxonomy. The tagging is ours: regulators charge statutory provisions, not technique names, so the mapping is an editorial judgement described in our editorial policy.

• Ponzi schemes — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2013-04-08 CFTC release published
2. 2016-01-29 Court orders disgorgement and civil monetary penalty (announced Feb. 8, 2016)

Primary documents

Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.

• CFTC release
• CFTC release 7321-16 (judgment)

The linked release is a work of the United States government and is not subject to copyright. Our summary and narrative above are our own writing.

Same matter

The library links these 2 records because they appear to concern one matter: the same lead defendant, an overlapping technique tag and close filing dates, or a shared court docket or a release that cites the other. Records are listed by date filed.

This grouping is the library's, made by matching names, techniques, dates and citations when the site is built. It is not the regulator's or a court's determination that the records are one case, and it errs towards missing a link rather than making a false one.

Related actions

Other actions in the library sharing at least one technique tag with this one.

Record added September 10, 2026. submit a correction.