U.S. District Judge refused to certify a class of investors in an alleged forex scam ROFX.net.

According to a report, U.S. District Judge Robert Scola of Miami refused on Thursday to certify a class of investors in an alleged forex scam ROFX.net.

l RoFx.net claimed to have AI for foreign exchange trades

l The site promised passive income for those who provided funds.

U.S. District Judge Robert Scola of Miami demonstrated a strong commitment to upholding class action procedure by rejecting the certification of a class of investors in an alleged foreign exchange scam. Interestingly, the judge made this decision despite having already ruled on the defendants liability, and none of the accused individuals involved in the scam appeared in court to contest the class certification.

The case revolves around RoFx.net, a now-defunct website that claimed to provide artificial intelligence-powered foreign exchange trading services. In an extensively amended complaint filed in 2022, attorneys from Holland & Knight, representing the plaintiffs, alleged that the entire operation was an illicit racketeering scheme. They asserted that the scam encompassed everything from deceptive advertisements targeting investors to the establishment of front companies that funneled money, concealing the fraudulent nature of the scheme.

Holland & Knight accused numerous defendants of participating in the RoFx scam, which reportedly defrauded investors of nearly $75 million. The U.S. Commodity Futures Trading Commission also filed a lawsuit against a subset of RoFx defendants, estimating that investor losses amounted to at least $58 million.

Remarkably, Holland & Knight dedicated significant efforts to litigating the RoFx case. In their class certification brief, the law firm disclosed investing over 3,000 hours and $1.7 million in the matter. They conducted an in-depth investigation into the alleged fraud, devised strategies to serve the accused fraudsters worldwide, and ultimately secured default judgments against 15 defendants on grounds of common law fraud and unjust enrichment. Although it remains unclear from the docket, it appears that some other defendants have reached settlements.

Holland & Knight also went to great lengths to identify members of the class, which comprises four named plaintiffs. They received notices from over 600 additional RoFx investors, many of whom submitted documentation of their transactions. To keep these alleged victims informed about case developments, the firm established a dedicated website. Moreover, they pledged to initiate legal proceedings in foreign jurisdictions against international banks that facilitated the alleged fraud. If necessary, Holland & Knight stated on the website that they would create a corporate entity to pursue investors' claims in jurisdictions where class actions are not permitted.

In their brief, Holland & Knight emphasized that all RoFx investors fell victim to the same fraudulent misrepresentations. They argued that the 11th U.S. Circuit Court of Appeals precedent supports the notion that, in cases involving fraud, classwide issues prevail over individual facts when plaintiffs are victims of a single “common scheme.” The firm also contended that individualized questions typically associated with unjust enrichment claims do not pose an obstacle in this case, as all investors were deceived by identical fraudulent promises.

About ROFX.net

ROFX.net is an online forex broker that offers a couple of financial instruments to its clients. This broker is not regulated. WikiFX has received multiple exposures against this broker. And WikiFX has given this scam broker a low score of 1.46/10.

ROFX.net claimed it had “artificially intelligent software that could conduct foreign exchange trading on behalf of customers” and promised customers passive income. It was shut down in September 2021, just over a week before the investors suit was filed.