Local Ohio man pleaded guilty to a $4.9M investment scheme
JEFFERSON COUNTY, Ohio — United States Attorney Kenneth L. Parker announced that a Toronto, Ohio, man pleaded guilty in U.S. District Court on Wednesday to crimes related to a multi-million investment scheme that victimized at least 65 individuals.
Parker says that William T. Caniff, Jr., 54, admitted to committing wire fraud and money laundering.
According to court documents, Caniff executed an investment scheme through a business he helped establish called Berkley Capital Management, LLC, purportedly to trade binary options.
Binary options are a type of options contract in which the payout depends on the outcome of a yes/no proposition. For example, a person may invest in a binary option regarding whether a company’s stock reaches a certain value. Still, the binary option does not give the investor any property interest in the company’s stock itself.
According to Parker, from March 2016 through December 2018, Caniff’s investment funds received more than $4.9 million from investors, most of whom were Dutch nationals.
Parker says Caniff misappropriated approximately $2.3 million of the investors’ funds for his own personal benefit, like the purchase of a residence, car payments, and credit card payments.
Caniff used new investments to pay past investors and invested only $85,000 in binary options.
As part of his scheme, Caniff fraudulently obtained membership to the North American Derivatives Exchange, Inc. (Nadex), an online binary-options exchange headquartered in Chicago.
According to Parker, he lied about having been convicted of multiple felonies to be approved as a Trading Member on Nadex.
Parties involved in this case have recommended a sentence of 30 months in prison.
As part of the plea, Caniff has agreed to pay approximately $2.3 million in restitution.
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