• Investments was a registered Commodity Pool Operator (CPO) and an National Futures Association (“NFA”) member as of October 2022. It managed a fund named Investment Fund LP, which began trading in December 2022 but ceased in May 2023.
    • Jindal Hemant is an associated person (AP) and listed principal of Investments, and he has been responsible for the firm’s operations.
  1. Applicable NFA Rules:
    • NFA Compliance Rule 2-2(a) prohibits members or associates from cheating, defrauding, or deceiving any commodity futures customers.
    • Other rules mandate high standards of commercial honor and just, equitable principles in business practices (Rule 2-4), diligent supervision of employees (Rule 2-9), and prohibit misleading promotional materials (Rule 2-29 and Rule 2-36).
  2. Violations Alleged in Complaint:
    • Count I: Misleading Promotional Material and Communications:
      • The complaint alleged that Investments and Jindal Hemant used promotional materials and communications that presented a distorted and misleading view of potential profits, without prominently discussing risks.
      • Jindal Hemant sent misleading emails to potential fund participants claiming the firm had substantial funds under management when it did not. Promotional materials also highlighted hypothetical performance as “live trading” or “live tested,” giving the impression that hypothetical returns were actual.
    • Count II: Acting Contrary to Just and Equitable Principles:
      • Despite instructions from the NFA to refrain from distributing deficient promotional materials, Jindal Hemant continued to share misleading materials with potential and current fund participants. The materials contained inaccurate or hypothetical performance information.
    • Count III: Failure to Supervise:
      • The firm and Jindal Hemant failed to supervise their promotional materials and email communications adequately. This lack of supervision resulted in misleading communications, which reflected a lack of high standards of commercial honor.
    • Jindal Hemant sent new presentations to the fund administrator after being told to stop distributing promotional materials, and when NFA requested links to review materials, the links did not grant access, suggesting continued non-compliance.

Overall, the complaint describes a series of acts by Investments and Jindal Hemant that involved misleading promotional materials, misrepresentations of fund performance, and failure to supervise and comply with NFA requirements. These actions are alleged to violate several NFA compliance rules, leading to disciplinary actions.

In response to the NFA Complaint, Investments and its principal Jindal Hemant proposed a settlement without admitting or denying the allegations. The summary of the settlement terms is as follows:

  • Investments agreed to never reapply for NFA membership or act as a principal of any NFA Member in the future.
  • Jindal Hemant agreed to not apply for NFA membership, reapply for NFA associate membership, or act as a principal of an NFA Member for 30 months from the effective date of the Decision.
  • After this 30-month period, if Jindal Hemant applies for NFA membership or NFA associate membership or seeks to become a principal of an NFA Member, he must pay a fine of $50,000 to the NFA. This fine must be paid in full before his application will be considered.
  • The Decision and Offer cannot be used as the sole basis for any other action by the NFA against Investments or Jindal Hemant, except in enforcing the terms of the settlement or in future disciplinary or regulatory actions, where they may be used as evidence of disciplinary history.

This settlement marks the closure of the NFA Complaint against Investments and Jindal Hemant, with clear conditions and consequences for any future attempts at NFA involvement.