CFTC Obtains $6.46 Million Order and Trading Ban in Options Fraud Case

The Commodity Futures Trading Commission said a federal court entered a default judgment against Michael Frederick Staryk, doing business as Magestic World Wide Finance and related names, in an options-on-commodity-futures fraud case. The CFTC said the judgment orders $547,616 in restitution and a $5,907,720 civil monetary penalty.

According to the regulator, the court also permanently enjoined Staryk from further Commodity Exchange Act and CFTC-regulation violations and imposed permanent trading and registration bans. The CFTC said its 2024 action alleged that at least 26 U.S. retail clients were solicited for purported options trading on commodity futures contracts, but the promised trading did not occur and client funds were misappropriated.

The agency also reported a consent order against two relief defendants that requires disgorgement of $110,509.86 in client funds. The orders resolve the claims in the CFTC’s 2024 enforcement action.

Why it matters

The order is a reminder for futures and options traders to verify who is handling their funds and whether a trading offer is registered or otherwise subject to appropriate oversight. Permanent trading and registration bans remove the defendant from CFTC-regulated markets, while restitution and penalty orders address the alleged misuse of customer money.

The release describes a court judgment in a specific case; it does not indicate a change to futures or options trading rules.

What to watch next

Traders can monitor the CFTC’s enforcement releases and registration resources when assessing an unfamiliar commodity-pool or options-trading offer. The practical question following an order is whether customers can identify their counterparty, custody arrangement, and regulatory status before sending funds.