The Ottoman Settlement [Old Version] 1916 Merchant Arena - A computerized trading platform that allows investors to trade with it in derivative financial instruments. Trading in the Trader's Arena is carried out against the Arena itself and is therefore sometimes characterized by a conflict of interest between the Trader and the Client: when the Client loses as a result of a transaction in a financial instrument, the Arena earns the full amount of his loss; And when the customer makes a profit, the arena is obligated to pay him the full profit.
12-34-56-78 Chekhov v. State of Israel, P.D. 51 (2)
CFD - A leveraged financial instrument whose value is derived from the price of the underlying asset as determined by the trader's own arena. This is a contract in which the seller undertakes to pay the buyer the difference between the current value of the underlying asset on the day of the transaction and the value of that asset at the time the contract is executed. In a CFD, the client gains or loses according to the "direction" of the transaction he has chosen and according to the direction of the underlying asset's movement. When the customer assesses that the value of the underlying asset will increase, he is expected to purchase the contract, and when he estimates that the value of the underlying asset has decreased, he is expected to make a short sale.
The significance of the leverage built into the CFD contract is that the client is not required to deposit the full face value of the trades he opens, but only a relative percentage of their value as collateral. Leverage in a CFD involves a lot of risk, because the higher it is, the smaller fluctuations in the price of the underlying asset, as opposed to the direction of the client's position, are enough for the arena to close his trades and he will lose the full amount of his investment. When the client's loss in all the trades he opened reaches a certain percentage of the total funds in his account, the arena will proactively close his transactions and he will be delisted from trading.
- The indictment goes on to detail three charges in which the defendant is charged with a number of offenses as detailed below.
- In the first charge, the defendant is charged with multiple offenses of fraudulent receipt, under section 415 of the Penal Law. According to the claim, during the relevant period, the defendant approached many potential customers and offered to manage a trading account for them using automated robotic trading. In order to open a trading account in Preston, you must pass a suitability test aimed at protecting clients and preventing situations in which they will find it difficult to make informed investment decisions due to a lack of understanding of the risk involved in their activity in the arena. As part of the suitability test, the client is required to fill out a questionnaire designed to enable Pepperstone to assess the extent to which he understands the risks associated with trading and his suitability for activity in the arena (hereinafter: the questionnaire). The defendant used to provide his clients with the answers to the questionnaire, thus enabling them to bypass the screening process and open a trading account in Pepperstone, even though they were not aware of the risks involved in investing in it. In addition, the defendant made a representation to the customers that his remuneration mechanism was based solely on success and therefore their interests were identical, since in a situation where their account was lost, he also did not make a profit. In the meantime, the defendant refrained from disclosing to them that he was compensated by Pepperstone for every customer who opened an account in the arena and traded in it at a trading volume set by it.
It was further claimed that the defendant recruited the customers while presenting false representations and concealing information regarding many essential aspects of his trade and activity. Based on these representations, the defendant obtained the consent of the clients to trade in the funds they deposited in the trading platform. The false representations made by the defendant for the purpose of recruiting clients are on a number of levels and are detailed to Helen: