DOJ, CFTC insist lawsuits brought by Forex Cartel trader are moot

The Department of Justice and the Commodity Futures Trading Commission (CFTC) are pushing for the dismissal of cases brought by Richard Usher, a former Forex trader known for his participation in the “Cartel” chatroom.

On Monday, August 16, 2021, the DOJ and the CFTC filed status reports with the Columbia District Court. The documents, seen by FX News Group, make it clear that the DOJ and the CFTC find the cases against them are moot. Richard Usher disagrees.

The parties, however, agree that it is in the interest of judicial economy to stay further briefing on the parties’ cross-motions for summary judgment pending resolution of the mootness issue. By September 10, 2021, the defendants are poised to file Suggestion of Mootness.

The lawsuits accused the CFTC and the DOJ of illegally preventing Usher from accessing documents that he would need in the administrative proceedings launched against him by the Office of the Comptroller of the Currency (OCC).

On July 7, 2021, the OCC informed Usher that it would unilaterally and voluntarily move to dismiss its action against him with prejudice. That move should have brought the cases against the CFTC and the DOJ to an end too. But it did not.

Usher wants to pursue claims against the OCC, and claims that continuing the lawsuits against the CFTC and the DOJ is necessary for him to pursue the case against the OCC.

Let’s recall that Usher was acquitted of charges of manipulating the Forex spot market in a criminal case brought by the DOJ. But he and Rohan Ramchandani then faced new challenges related to the events that led to the criminal proceedings against them, as the OCC targeted them in administrative proceedings.

As FX News Group has reported, Usher filed an action against the CFTC under the Administrative Procedure Act, seeking to compel the regulator to produce documents in response to a subpoena issued by an administrative law judge overseeing an enforcement action against Plaintiff brought by the Office of the Comptroller of the Currency. The trader alleged that he needed the documents in order to defend himself in the OCC Proceeding.

On July 7, 2021, enforcement counsel for the OCC withdrew all charges against Plaintiff, with prejudice. And on July 8, 2021, the administrative law judge closed the OCC Proceeding. The case against the CFTC is therefore moot, the regulator says.

The stance of the DOJ is similar to that of the CFTC. Usher filed an action under the Administrative Procedure Act, seeking to compel the Department of Justice to produce documents that he sought in connection with an underlying enforcement action against him brought by the Office of the Comptroller of the Currency.

Usher alleged that he needed the documents in order to defend himself in the OCC Proceeding. Given that the OCC withdrew all charges against Usher on July 7, 2021, the case against the DOJ should be declared as moot, the DOJ says.

The trader disagrees with the CFTC and the DOJ.

He notes that, during the course of the OCC administrative process, he was denied access to millions more exculpatory documents, including the CFTC documents requested in the at-issue subpoena.

Usher says that the OCC ignored, and he was denied access to documents essential to his defense, including from the CFTC, from the DOJ Antitrust Division, and from third parties. The Government’s hiding of, and obstructive measures to deprive Usher of, exculpatory evidence remains a very serious and unremedied due process breach, Usher alleges. Accordingly, he will seek post-dismissal relief; specifically, Usher is evaluating his options for seeking post-dismissal relief from the Comptroller for these violations.

The basis for seeking such relief would be, in part, the constitutional and civil rights violations of Mr. Usher’s rights, including the OCC’s renewed pursuit of its case against him beginning in January 2020 despite the criminal trial acquittal in October 2018 and the knowledge that its case was meritless.

Documents concerning the CFTC’s rationale for settling with JPMorgan, and any awareness of (or willful blindness to) the existence of these documents by the OCC, would be highly relevant to Usher’s claims for post-dismissal relief, he says.

The trader also says that the DOJ’s denial of exculpatory documents was especially egregious because the exculpatory nature of the documents had already been conceded by the DOJ’s earlier production of these same documents in the earlier criminal case against Usher. The DOJ’s obstruction included maintaining that public trial exhibits were not public documents.

Usher says that documents from the criminal discovery record will make plain any awareness of the OCC of (or willful blindness to) the existence of facts that disproved the OCC’s case, and would be highly relevant to his claims for post-dismissal relief.