Case Summary

For Release: April 7, 2009

CFTC Charges Two Florida Companies and Three Florida Men with Operating a Fraudulent Commodity Pool that Solicited Approximately $17 Million from about 100 Investors

Capital Blu Management, LLC, DD International Holdings, LLC, Donovan Davis. Jr., Blayne Davis, and Damien Bromfield Allegedly Defrauded Investors Seeking to Invest in Foreign Currency (Forex)

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it charged Donovan Davis, Jr. (D. Davis) of Palm Bay, Florida, Blayne Davis (B. Davis), of Naples, Florida, Damien Bromfield, of Ocoee, Florida, Capital Blu Management, LLC (Capital Blu) of Melbourne, Florida, and DD International Holdings, LLC (DDIH) of Palm Bay, Florida with operating a fraudulent commodity scheme involving about 100 investors and approximately $17 million solicited purportedly to invest in foreign currency (forex) futures and options.

The complaint was filed under seal on March 23, 2009, in the U.S. District Court for the Middle District of Florida. On the same day, the Honorable John Antoon II entered an order freezing defendants’ assets and preserving books and records.

As alleged, defendants told prospective investors that their funds would be pooled in the CBM FX Fund, LP (FX Fund), a commodity pool established by Capital Blu. Rather than pool investor funds, the defendants split the funds into trading of both off-exchange and on-exchange forex futures and off-exchange forex options. In addition, the defendants allegedly deposited millions of dollars into multiple Capital Blu bank accounts, where funds were commingled and misappropriated for personal use, including luxury automobiles, private jet charters and, a two-night $40,000 spree at a “gentlemen’s club.”

Ultimately, as alleged, of the $17 million solicited, $7 million was lost in trading, and millions of dollars remain unaccounted for.

To hide their fraud, the complaint alleges, D. Davis, B. Davis, and Bromfield provided investors with phony account statements misrepresenting the earnings in their accounts by showing consistent monthly profits as high as 7 percent for 12 straight months (September 2007 through August 2008). In fact, as alleged, defendants’ actual trading resulted in net losses every month.

Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC Named as Relief Defendants

According to the complaint, B. Davis withdrew more than $135,000 of the pool participants’ funds and deposited those funds into accounts held in the name of one or more of Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC, all of whom have been named in the CFTC complaint as relief defendants. None of these entities provided legitimate services to the FX Fund and have no legitimate entitlement to the funds they received.

In its continuing litigation, the CFTC seeks restitution, disgorgement of ill-gotten gains, civil monetary penalties, and permanent injunctions against further trading.

The CFTC’s Division of Enforcement would like to thank the National Futures Association and the State of Florida Office of Financial Regulation in Orlando, Florida for their assistance.

The following Division of Enforcement staff members are responsible for this case: Daniel Jordan, Kenneth McCracken, Michael Loconte, and Rick Glaser.

Last Updated: April 7, 2009

June 15, 2011

Federal Court in Florida Orders Capital Blu Management, LLC, Donovan Davis Jr., Damien Bromfield, Blayne Davis and DD International Holdings, LLC to Pay More than $17 Million for Committing Fraud

Ruling follows a verdict returned after three-week jury trial in Orlando, Florida.

Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced that the Honorable Judge John Antoon II of the U.S. District Court for the Middle District of Florida ordered Capital Blu Management, LLC (Capital Blu) of Melbourne, Fla., Donovan Davis Jr. of Palm Bay, Fla., Damien Bromfield of Ocoee, Fla., Blayne Davis of Naples, Fla., and DD International Holdings, LLC (DDIH) of Palm Bay, Fla., jointly and severally to pay restitution of $2,463,592.12. Judge Antoon ordered Bromfield and Blayne Davis each to pay a civil monetary penalty of $4,927,184.24 and ordered Donovan Davis Jr. and DDIH jointly and severally to pay a civil monetary penalty of the same amount.

The federal order, entered on June 9, 2011, also permanently bars all defendants from engaging in any commodity-related activity, including trading and registering with the CFTC.

The order follows a verdict returned on February 3, 2011 against Donovan Davis Jr. and Bromfield by a jury in Orlando, Fla., that heard testimony and arguments for almost three weeks. In 2009, the CFTC charged the defendants with operating a fraudulent commodity pool that solicited approximately $17 million from about 100 investors purportedly to invest in off-exchange foreign currency futures (see CFTC Press Release 5643-09, April 7, 2009).

According to the evidence adduced at trial, Donovan Davis Jr. (through his wholly owned company, DDIH) and Bromfield were two of the three principals of Capital Blu, a commodity pool operator that managed a foreign currency trading fund called the CBM FX Fund, LP. Donovan Davis Jr. was Capital Blu’s Director of Corporate Affairs and Bromfield was its Director of Operations. The third principal of Capital Blu, Blayne Davis, was the Director of Trading. Because Blayne Davis, Capital Blu and DDIH did not respond to the CFTC’s complaint, the court entered default judgments against them.

According to the evidence presented at trial, Capital Blu began soliciting participants for the CBM FX Fund in August 2007 and ultimately obtained contributions from participants totaling approximately $17 million. In January 2008, the CBM FX Fund sustained losses of about $1.8 million. Instead of reporting a loss for the month to the participants, Donovan Davis Jr. instructed Capital Blu’s Controller to report a 1.6 percent gain for January 2008. Thereafter, Bromfield, Donovan Davis Jr. and Blayne Davis developed and implemented a plan to put the money that had been lost back into the CBM FX Fund, which included raising additional funds from new participants, trading aggressively and falsifying statements to participants.

At roughly this same time, Capital Blu’s expenses began to exceed its revenue. At the direction of its principals, Capital Blu began to pay operating expense with money from the CBM FX Fund. These expenses included the purchase and operation of a jet.

After some short-term trading success from April to July 2008, in August 2008 the CBM FX Fund sustained millions of dollars in losses. Instead of reporting these losses, Bromfield and Donovan Davis Jr. again provided participants with falsified statements and reported a 0.16 percent profit for August 2008. Bromfield and Donovan Davis Jr. also sent participants a notice that their funds would be locked up for four months. All the while, Bromfield, Donovan Davis Jr. and Blayne Davis continued to use CBM FX Fund money to pay operating expenses, including their own salaries of $15,000 per month each. Capital Blu’s operations were shut down after the National Futures Association (NFA) conducted a surprise audit in September 2008 after receiving information from several sources, including an employee of Capital Blu.

During the trial and a subsequent damages hearing conducted on March 2, 2011 before Judge Antoon, the CFTC established that, from January 2008 through September 2008, the CBM FX Fund sustained trading losses of approximately $5.4 million and defendants misappropriated approximately $2.46 million of participants’ funds. Judge Antoon ordered the defendants to pay the amount misappropriated as restitution and ordered a civil monetary penalty equal to twice the amount that the defendants misappropriated.

The CFTC thanks the NFA for its assistance.

CFTC staff responsible for this case are Patrick M. Pericak, Daniel C. Jordan, Heather Johnson, Erica Bodin, Melissa Glasbrenner, Bobby Williams, Sandy Rim, Jessica Harris, Melissa Strom, Matthew Elkan, Eugenia Vroustouris, Kenneth McCracken, Rick Glaser and Richard Wagner.

Media Contacts

Dennis Holden

202-418-5088

Last Updated: June 16, 2011

For Release: April 7, 2009

CFTC Charges Two Florida Companies and Three Florida Men with Operating a Fraudulent Commodity Pool that Solicited Approximately $17 Million from about 100 Investors

Capital Blu Management, LLC, DD International Holdings, LLC, Donovan Davis. Jr., Blayne Davis, and Damien Bromfield Allegedly Defrauded Investors Seeking to Invest in Foreign Currency (Forex)

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it charged Donovan Davis, Jr. (D. Davis) of Palm Bay, Florida, Blayne Davis (B. Davis), of Naples, Florida, Damien Bromfield, of Ocoee, Florida, Capital Blu Management, LLC (Capital Blu) of Melbourne, Florida, and DD International Holdings, LLC (DDIH) of Palm Bay, Florida with operating a fraudulent commodity scheme involving about 100 investors and approximately $17 million solicited purportedly to invest in foreign currency (forex) futures and options.

The complaint was filed under seal on March 23, 2009, in the U.S. District Court for the Middle District of Florida. On the same day, the Honorable John Antoon II entered an order freezing defendants’ assets and preserving books and records.

As alleged, defendants told prospective investors that their funds would be pooled in the CBM FX Fund, LP (FX Fund), a commodity pool established by Capital Blu. Rather than pool investor funds, the defendants split the funds into trading of both off-exchange and on-exchange forex futures and off-exchange forex options. In addition, the defendants allegedly deposited millions of dollars into multiple Capital Blu bank accounts, where funds were commingled and misappropriated for personal use, including luxury automobiles, private jet charters and, a two-night $40,000 spree at a “gentlemen’s club.”

Ultimately, as alleged, of the $17 million solicited, $7 million was lost in trading, and millions of dollars remain unaccounted for.

To hide their fraud, the complaint alleges, D. Davis, B. Davis, and Bromfield provided investors with phony account statements misrepresenting the earnings in their accounts by showing consistent monthly profits as high as 7 percent for 12 straight months (September 2007 through August 2008). In fact, as alleged, defendants’ actual trading resulted in net losses every month.

Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC Named as Relief Defendants

According to the complaint, B. Davis withdrew more than $135,000 of the pool participants’ funds and deposited those funds into accounts held in the name of one or more of Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC, all of whom have been named in the CFTC complaint as relief defendants. None of these entities provided legitimate services to the FX Fund and have no legitimate entitlement to the funds they received.

In its continuing litigation, the CFTC seeks restitution, disgorgement of ill-gotten gains, civil monetary penalties, and permanent injunctions against further trading.

The CFTC’s Division of Enforcement would like to thank the National Futures Association and the State of Florida Office of Financial Regulation in Orlando, Florida for their assistance.

The following Division of Enforcement staff members are responsible for this case: Daniel Jordan, Kenneth McCracken, Michael Loconte, and Rick Glaser.

Last Updated: April 7, 2009

June 15, 2011

Federal Court in Florida Orders Capital Blu Management, LLC, Donovan Davis Jr., Damien Bromfield, Blayne Davis and DD International Holdings, LLC to Pay More than $17 Million for Committing Fraud

Ruling follows a verdict returned after three-week jury trial in Orlando, Florida.

Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced that the Honorable Judge John Antoon II of the U.S. District Court for the Middle District of Florida ordered Capital Blu Management, LLC (Capital Blu) of Melbourne, Fla., Donovan Davis Jr. of Palm Bay, Fla., Damien Bromfield of Ocoee, Fla., Blayne Davis of Naples, Fla., and DD International Holdings, LLC (DDIH) of Palm Bay, Fla., jointly and severally to pay restitution of $2,463,592.12. Judge Antoon ordered Bromfield and Blayne Davis each to pay a civil monetary penalty of $4,927,184.24 and ordered Donovan Davis Jr. and DDIH jointly and severally to pay a civil monetary penalty of the same amount.

The federal order, entered on June 9, 2011, also permanently bars all defendants from engaging in any commodity-related activity, including trading and registering with the CFTC.

The order follows a verdict returned on February 3, 2011 against Donovan Davis Jr. and Bromfield by a jury in Orlando, Fla., that heard testimony and arguments for almost three weeks. In 2009, the CFTC charged the defendants with operating a fraudulent commodity pool that solicited approximately $17 million from about 100 investors purportedly to invest in off-exchange foreign currency futures (see CFTC Press Release 5643-09, April 7, 2009).

According to the evidence adduced at trial, Donovan Davis Jr. (through his wholly owned company, DDIH) and Bromfield were two of the three principals of Capital Blu, a commodity pool operator that managed a foreign currency trading fund called the CBM FX Fund, LP. Donovan Davis Jr. was Capital Blu’s Director of Corporate Affairs and Bromfield was its Director of Operations. The third principal of Capital Blu, Blayne Davis, was the Director of Trading. Because Blayne Davis, Capital Blu and DDIH did not respond to the CFTC’s complaint, the court entered default judgments against them.

According to the evidence presented at trial, Capital Blu began soliciting participants for the CBM FX Fund in August 2007 and ultimately obtained contributions from participants totaling approximately $17 million. In January 2008, the CBM FX Fund sustained losses of about $1.8 million. Instead of reporting a loss for the month to the participants, Donovan Davis Jr. instructed Capital Blu’s Controller to report a 1.6 percent gain for January 2008. Thereafter, Bromfield, Donovan Davis Jr. and Blayne Davis developed and implemented a plan to put the money that had been lost back into the CBM FX Fund, which included raising additional funds from new participants, trading aggressively and falsifying statements to participants.

At roughly this same time, Capital Blu’s expenses began to exceed its revenue. At the direction of its principals, Capital Blu began to pay operating expense with money from the CBM FX Fund. These expenses included the purchase and operation of a jet.

After some short-term trading success from April to July 2008, in August 2008 the CBM FX Fund sustained millions of dollars in losses. Instead of reporting these losses, Bromfield and Donovan Davis Jr. again provided participants with falsified statements and reported a 0.16 percent profit for August 2008. Bromfield and Donovan Davis Jr. also sent participants a notice that their funds would be locked up for four months. All the while, Bromfield, Donovan Davis Jr. and Blayne Davis continued to use CBM FX Fund money to pay operating expenses, including their own salaries of $15,000 per month each. Capital Blu’s operations were shut down after the National Futures Association (NFA) conducted a surprise audit in September 2008 after receiving information from several sources, including an employee of Capital Blu.

During the trial and a subsequent damages hearing conducted on March 2, 2011 before Judge Antoon, the CFTC established that, from January 2008 through September 2008, the CBM FX Fund sustained trading losses of approximately $5.4 million and defendants misappropriated approximately $2.46 million of participants’ funds. Judge Antoon ordered the defendants to pay the amount misappropriated as restitution and ordered a civil monetary penalty equal to twice the amount that the defendants misappropriated.

The CFTC thanks the NFA for its assistance.

CFTC staff responsible for this case are Patrick M. Pericak, Daniel C. Jordan, Heather Johnson, Erica Bodin, Melissa Glasbrenner, Bobby Williams, Sandy Rim, Jessica Harris, Melissa Strom, Matthew Elkan, Eugenia Vroustouris, Kenneth McCracken, Rick Glaser and Richard Wagner.

Media Contacts

Dennis Holden

202-418-5088

Last Updated: June 16, 2011

For Release: April 7, 2009

CFTC Charges Two Florida Companies and Three Florida Men with Operating a Fraudulent Commodity Pool that Solicited Approximately $17 Million from about 100 Investors

Capital Blu Management, LLC, DD International Holdings, LLC, Donovan Davis. Jr., Blayne Davis, and Damien Bromfield Allegedly Defrauded Investors Seeking to Invest in Foreign Currency (Forex)

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it charged Donovan Davis, Jr. (D. Davis) of Palm Bay, Florida, Blayne Davis (B. Davis), of Naples, Florida, Damien Bromfield, of Ocoee, Florida, Capital Blu Management, LLC (Capital Blu) of Melbourne, Florida, and DD International Holdings, LLC (DDIH) of Palm Bay, Florida with operating a fraudulent commodity scheme involving about 100 investors and approximately $17 million solicited purportedly to invest in foreign currency (forex) futures and options.

The complaint was filed under seal on March 23, 2009, in the U.S. District Court for the Middle District of Florida. On the same day, the Honorable John Antoon II entered an order freezing defendants’ assets and preserving books and records.

As alleged, defendants told prospective investors that their funds would be pooled in the CBM FX Fund, LP (FX Fund), a commodity pool established by Capital Blu. Rather than pool investor funds, the defendants split the funds into trading of both off-exchange and on-exchange forex futures and off-exchange forex options. In addition, the defendants allegedly deposited millions of dollars into multiple Capital Blu bank accounts, where funds were commingled and misappropriated for personal use, including luxury automobiles, private jet charters and, a two-night $40,000 spree at a “gentlemen’s club.”

Ultimately, as alleged, of the $17 million solicited, $7 million was lost in trading, and millions of dollars remain unaccounted for.

To hide their fraud, the complaint alleges, D. Davis, B. Davis, and Bromfield provided investors with phony account statements misrepresenting the earnings in their accounts by showing consistent monthly profits as high as 7 percent for 12 straight months (September 2007 through August 2008). In fact, as alleged, defendants’ actual trading resulted in net losses every month.

Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC Named as Relief Defendants

According to the complaint, B. Davis withdrew more than $135,000 of the pool participants’ funds and deposited those funds into accounts held in the name of one or more of Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC, all of whom have been named in the CFTC complaint as relief defendants. None of these entities provided legitimate services to the FX Fund and have no legitimate entitlement to the funds they received.

In its continuing litigation, the CFTC seeks restitution, disgorgement of ill-gotten gains, civil monetary penalties, and permanent injunctions against further trading.

The CFTC’s Division of Enforcement would like to thank the National Futures Association and the State of Florida Office of Financial Regulation in Orlando, Florida for their assistance.

The following Division of Enforcement staff members are responsible for this case: Daniel Jordan, Kenneth McCracken, Michael Loconte, and Rick Glaser.

Last Updated: April 7, 2009

June 15, 2011

Federal Court in Florida Orders Capital Blu Management, LLC, Donovan Davis Jr., Damien Bromfield, Blayne Davis and DD International Holdings, LLC to Pay More than $17 Million for Committing Fraud

Ruling follows a verdict returned after three-week jury trial in Orlando, Florida.

Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced that the Honorable Judge John Antoon II of the U.S. District Court for the Middle District of Florida ordered Capital Blu Management, LLC (Capital Blu) of Melbourne, Fla., Donovan Davis Jr. of Palm Bay, Fla., Damien Bromfield of Ocoee, Fla., Blayne Davis of Naples, Fla., and DD International Holdings, LLC (DDIH) of Palm Bay, Fla., jointly and severally to pay restitution of $2,463,592.12. Judge Antoon ordered Bromfield and Blayne Davis each to pay a civil monetary penalty of $4,927,184.24 and ordered Donovan Davis Jr. and DDIH jointly and severally to pay a civil monetary penalty of the same amount.

The federal order, entered on June 9, 2011, also permanently bars all defendants from engaging in any commodity-related activity, including trading and registering with the CFTC.

The order follows a verdict returned on February 3, 2011 against Donovan Davis Jr. and Bromfield by a jury in Orlando, Fla., that heard testimony and arguments for almost three weeks. In 2009, the CFTC charged the defendants with operating a fraudulent commodity pool that solicited approximately $17 million from about 100 investors purportedly to invest in off-exchange foreign currency futures (see CFTC Press Release 5643-09, April 7, 2009).

According to the evidence adduced at trial, Donovan Davis Jr. (through his wholly owned company, DDIH) and Bromfield were two of the three principals of Capital Blu, a commodity pool operator that managed a foreign currency trading fund called the CBM FX Fund, LP. Donovan Davis Jr. was Capital Blu’s Director of Corporate Affairs and Bromfield was its Director of Operations. The third principal of Capital Blu, Blayne Davis, was the Director of Trading. Because Blayne Davis, Capital Blu and DDIH did not respond to the CFTC’s complaint, the court entered default judgments against them.

According to the evidence presented at trial, Capital Blu began soliciting participants for the CBM FX Fund in August 2007 and ultimately obtained contributions from participants totaling approximately $17 million. In January 2008, the CBM FX Fund sustained losses of about $1.8 million. Instead of reporting a loss for the month to the participants, Donovan Davis Jr. instructed Capital Blu’s Controller to report a 1.6 percent gain for January 2008. Thereafter, Bromfield, Donovan Davis Jr. and Blayne Davis developed and implemented a plan to put the money that had been lost back into the CBM FX Fund, which included raising additional funds from new participants, trading aggressively and falsifying statements to participants.

At roughly this same time, Capital Blu’s expenses began to exceed its revenue. At the direction of its principals, Capital Blu began to pay operating expense with money from the CBM FX Fund. These expenses included the purchase and operation of a jet.

After some short-term trading success from April to July 2008, in August 2008 the CBM FX Fund sustained millions of dollars in losses. Instead of reporting these losses, Bromfield and Donovan Davis Jr. again provided participants with falsified statements and reported a 0.16 percent profit for August 2008. Bromfield and Donovan Davis Jr. also sent participants a notice that their funds would be locked up for four months. All the while, Bromfield, Donovan Davis Jr. and Blayne Davis continued to use CBM FX Fund money to pay operating expenses, including their own salaries of $15,000 per month each. Capital Blu’s operations were shut down after the National Futures Association (NFA) conducted a surprise audit in September 2008 after receiving information from several sources, including an employee of Capital Blu.

During the trial and a subsequent damages hearing conducted on March 2, 2011 before Judge Antoon, the CFTC established that, from January 2008 through September 2008, the CBM FX Fund sustained trading losses of approximately $5.4 million and defendants misappropriated approximately $2.46 million of participants’ funds. Judge Antoon ordered the defendants to pay the amount misappropriated as restitution and ordered a civil monetary penalty equal to twice the amount that the defendants misappropriated.

The CFTC thanks the NFA for its assistance.

CFTC staff responsible for this case are Patrick M. Pericak, Daniel C. Jordan, Heather Johnson, Erica Bodin, Melissa Glasbrenner, Bobby Williams, Sandy Rim, Jessica Harris, Melissa Strom, Matthew Elkan, Eugenia Vroustouris, Kenneth McCracken, Rick Glaser and Richard Wagner.

Media Contacts

Dennis Holden

202-418-5088

Last Updated: June 16, 2011

For Release: April 7, 2009

CFTC Charges Two Florida Companies and Three Florida Men with Operating a Fraudulent Commodity Pool that Solicited Approximately $17 Million from about 100 Investors

Capital Blu Management, LLC, DD International Holdings, LLC, Donovan Davis. Jr., Blayne Davis, and Damien Bromfield Allegedly Defrauded Investors Seeking to Invest in Foreign Currency (Forex)

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it charged Donovan Davis, Jr. (D. Davis) of Palm Bay, Florida, Blayne Davis (B. Davis), of Naples, Florida, Damien Bromfield, of Ocoee, Florida, Capital Blu Management, LLC (Capital Blu) of Melbourne, Florida, and DD International Holdings, LLC (DDIH) of Palm Bay, Florida with operating a fraudulent commodity scheme involving about 100 investors and approximately $17 million solicited purportedly to invest in foreign currency (forex) futures and options.

The complaint was filed under seal on March 23, 2009, in the U.S. District Court for the Middle District of Florida. On the same day, the Honorable John Antoon II entered an order freezing defendants’ assets and preserving books and records.

As alleged, defendants told prospective investors that their funds would be pooled in the CBM FX Fund, LP (FX Fund), a commodity pool established by Capital Blu. Rather than pool investor funds, the defendants split the funds into trading of both off-exchange and on-exchange forex futures and off-exchange forex options. In addition, the defendants allegedly deposited millions of dollars into multiple Capital Blu bank accounts, where funds were commingled and misappropriated for personal use, including luxury automobiles, private jet charters and, a two-night $40,000 spree at a “gentlemen’s club.”

Ultimately, as alleged, of the $17 million solicited, $7 million was lost in trading, and millions of dollars remain unaccounted for.

To hide their fraud, the complaint alleges, D. Davis, B. Davis, and Bromfield provided investors with phony account statements misrepresenting the earnings in their accounts by showing consistent monthly profits as high as 7 percent for 12 straight months (September 2007 through August 2008). In fact, as alleged, defendants’ actual trading resulted in net losses every month.

Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC Named as Relief Defendants

According to the complaint, B. Davis withdrew more than $135,000 of the pool participants’ funds and deposited those funds into accounts held in the name of one or more of Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC, all of whom have been named in the CFTC complaint as relief defendants. None of these entities provided legitimate services to the FX Fund and have no legitimate entitlement to the funds they received.

In its continuing litigation, the CFTC seeks restitution, disgorgement of ill-gotten gains, civil monetary penalties, and permanent injunctions against further trading.

The CFTC’s Division of Enforcement would like to thank the National Futures Association and the State of Florida Office of Financial Regulation in Orlando, Florida for their assistance.

The following Division of Enforcement staff members are responsible for this case: Daniel Jordan, Kenneth McCracken, Michael Loconte, and Rick Glaser.

Last Updated: April 7, 2009

June 15, 2011

Federal Court in Florida Orders Capital Blu Management, LLC, Donovan Davis Jr., Damien Bromfield, Blayne Davis and DD International Holdings, LLC to Pay More than $17 Million for Committing Fraud

Ruling follows a verdict returned after three-week jury trial in Orlando, Florida.

Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced that the Honorable Judge John Antoon II of the U.S. District Court for the Middle District of Florida ordered Capital Blu Management, LLC (Capital Blu) of Melbourne, Fla., Donovan Davis Jr. of Palm Bay, Fla., Damien Bromfield of Ocoee, Fla., Blayne Davis of Naples, Fla., and DD International Holdings, LLC (DDIH) of Palm Bay, Fla., jointly and severally to pay restitution of $2,463,592.12. Judge Antoon ordered Bromfield and Blayne Davis each to pay a civil monetary penalty of $4,927,184.24 and ordered Donovan Davis Jr. and DDIH jointly and severally to pay a civil monetary penalty of the same amount.

The federal order, entered on June 9, 2011, also permanently bars all defendants from engaging in any commodity-related activity, including trading and registering with the CFTC.

The order follows a verdict returned on February 3, 2011 against Donovan Davis Jr. and Bromfield by a jury in Orlando, Fla., that heard testimony and arguments for almost three weeks. In 2009, the CFTC charged the defendants with operating a fraudulent commodity pool that solicited approximately $17 million from about 100 investors purportedly to invest in off-exchange foreign currency futures (see CFTC Press Release 5643-09, April 7, 2009).

According to the evidence adduced at trial, Donovan Davis Jr. (through his wholly owned company, DDIH) and Bromfield were two of the three principals of Capital Blu, a commodity pool operator that managed a foreign currency trading fund called the CBM FX Fund, LP. Donovan Davis Jr. was Capital Blu’s Director of Corporate Affairs and Bromfield was its Director of Operations. The third principal of Capital Blu, Blayne Davis, was the Director of Trading. Because Blayne Davis, Capital Blu and DDIH did not respond to the CFTC’s complaint, the court entered default judgments against them.

According to the evidence presented at trial, Capital Blu began soliciting participants for the CBM FX Fund in August 2007 and ultimately obtained contributions from participants totaling approximately $17 million. In January 2008, the CBM FX Fund sustained losses of about $1.8 million. Instead of reporting a loss for the month to the participants, Donovan Davis Jr. instructed Capital Blu’s Controller to report a 1.6 percent gain for January 2008. Thereafter, Bromfield, Donovan Davis Jr. and Blayne Davis developed and implemented a plan to put the money that had been lost back into the CBM FX Fund, which included raising additional funds from new participants, trading aggressively and falsifying statements to participants.

At roughly this same time, Capital Blu’s expenses began to exceed its revenue. At the direction of its principals, Capital Blu began to pay operating expense with money from the CBM FX Fund. These expenses included the purchase and operation of a jet.

After some short-term trading success from April to July 2008, in August 2008 the CBM FX Fund sustained millions of dollars in losses. Instead of reporting these losses, Bromfield and Donovan Davis Jr. again provided participants with falsified statements and reported a 0.16 percent profit for August 2008. Bromfield and Donovan Davis Jr. also sent participants a notice that their funds would be locked up for four months. All the while, Bromfield, Donovan Davis Jr. and Blayne Davis continued to use CBM FX Fund money to pay operating expenses, including their own salaries of $15,000 per month each. Capital Blu’s operations were shut down after the National Futures Association (NFA) conducted a surprise audit in September 2008 after receiving information from several sources, including an employee of Capital Blu.

During the trial and a subsequent damages hearing conducted on March 2, 2011 before Judge Antoon, the CFTC established that, from January 2008 through September 2008, the CBM FX Fund sustained trading losses of approximately $5.4 million and defendants misappropriated approximately $2.46 million of participants’ funds. Judge Antoon ordered the defendants to pay the amount misappropriated as restitution and ordered a civil monetary penalty equal to twice the amount that the defendants misappropriated.

The CFTC thanks the NFA for its assistance.

CFTC staff responsible for this case are Patrick M. Pericak, Daniel C. Jordan, Heather Johnson, Erica Bodin, Melissa Glasbrenner, Bobby Williams, Sandy Rim, Jessica Harris, Melissa Strom, Matthew Elkan, Eugenia Vroustouris, Kenneth McCracken, Rick Glaser and Richard Wagner.

Media Contacts

Dennis Holden

202-418-5088

Last Updated: June 16, 2011

For Release: April 7, 2009

CFTC Charges Two Florida Companies and Three Florida Men with Operating a Fraudulent Commodity Pool that Solicited Approximately $17 Million from about 100 Investors

Capital Blu Management, LLC, DD International Holdings, LLC, Donovan Davis. Jr., Blayne Davis, and Damien Bromfield Allegedly Defrauded Investors Seeking to Invest in Foreign Currency (Forex)

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it charged Donovan Davis, Jr. (D. Davis) of Palm Bay, Florida, Blayne Davis (B. Davis), of Naples, Florida, Damien Bromfield, of Ocoee, Florida, Capital Blu Management, LLC (Capital Blu) of Melbourne, Florida, and DD International Holdings, LLC (DDIH) of Palm Bay, Florida with operating a fraudulent commodity scheme involving about 100 investors and approximately $17 million solicited purportedly to invest in foreign currency (forex) futures and options.

The complaint was filed under seal on March 23, 2009, in the U.S. District Court for the Middle District of Florida. On the same day, the Honorable John Antoon II entered an order freezing defendants’ assets and preserving books and records.

As alleged, defendants told prospective investors that their funds would be pooled in the CBM FX Fund, LP (FX Fund), a commodity pool established by Capital Blu. Rather than pool investor funds, the defendants split the funds into trading of both off-exchange and on-exchange forex futures and off-exchange forex options. In addition, the defendants allegedly deposited millions of dollars into multiple Capital Blu bank accounts, where funds were commingled and misappropriated for personal use, including luxury automobiles, private jet charters and, a two-night $40,000 spree at a “gentlemen’s club.”

Ultimately, as alleged, of the $17 million solicited, $7 million was lost in trading, and millions of dollars remain unaccounted for.

To hide their fraud, the complaint alleges, D. Davis, B. Davis, and Bromfield provided investors with phony account statements misrepresenting the earnings in their accounts by showing consistent monthly profits as high as 7 percent for 12 straight months (September 2007 through August 2008). In fact, as alleged, defendants’ actual trading resulted in net losses every month.

Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC Named as Relief Defendants

According to the complaint, B. Davis withdrew more than $135,000 of the pool participants’ funds and deposited those funds into accounts held in the name of one or more of Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC, all of whom have been named in the CFTC complaint as relief defendants. None of these entities provided legitimate services to the FX Fund and have no legitimate entitlement to the funds they received.

In its continuing litigation, the CFTC seeks restitution, disgorgement of ill-gotten gains, civil monetary penalties, and permanent injunctions against further trading.

The CFTC’s Division of Enforcement would like to thank the National Futures Association and the State of Florida Office of Financial Regulation in Orlando, Florida for their assistance.

The following Division of Enforcement staff members are responsible for this case: Daniel Jordan, Kenneth McCracken, Michael Loconte, and Rick Glaser.

Last Updated: April 7, 2009

June 15, 2011

Federal Court in Florida Orders Capital Blu Management, LLC, Donovan Davis Jr., Damien Bromfield, Blayne Davis and DD International Holdings, LLC to Pay More than $17 Million for Committing Fraud

Ruling follows a verdict returned after three-week jury trial in Orlando, Florida.

Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced that the Honorable Judge John Antoon II of the U.S. District Court for the Middle District of Florida ordered Capital Blu Management, LLC (Capital Blu) of Melbourne, Fla., Donovan Davis Jr. of Palm Bay, Fla., Damien Bromfield of Ocoee, Fla., Blayne Davis of Naples, Fla., and DD International Holdings, LLC (DDIH) of Palm Bay, Fla., jointly and severally to pay restitution of $2,463,592.12. Judge Antoon ordered Bromfield and Blayne Davis each to pay a civil monetary penalty of $4,927,184.24 and ordered Donovan Davis Jr. and DDIH jointly and severally to pay a civil monetary penalty of the same amount.

The federal order, entered on June 9, 2011, also permanently bars all defendants from engaging in any commodity-related activity, including trading and registering with the CFTC.

The order follows a verdict returned on February 3, 2011 against Donovan Davis Jr. and Bromfield by a jury in Orlando, Fla., that heard testimony and arguments for almost three weeks. In 2009, the CFTC charged the defendants with operating a fraudulent commodity pool that solicited approximately $17 million from about 100 investors purportedly to invest in off-exchange foreign currency futures (see CFTC Press Release 5643-09, April 7, 2009).

According to the evidence adduced at trial, Donovan Davis Jr. (through his wholly owned company, DDIH) and Bromfield were two of the three principals of Capital Blu, a commodity pool operator that managed a foreign currency trading fund called the CBM FX Fund, LP. Donovan Davis Jr. was Capital Blu’s Director of Corporate Affairs and Bromfield was its Director of Operations. The third principal of Capital Blu, Blayne Davis, was the Director of Trading. Because Blayne Davis, Capital Blu and DDIH did not respond to the CFTC’s complaint, the court entered default judgments against them.

According to the evidence presented at trial, Capital Blu began soliciting participants for the CBM FX Fund in August 2007 and ultimately obtained contributions from participants totaling approximately $17 million. In January 2008, the CBM FX Fund sustained losses of about $1.8 million. Instead of reporting a loss for the month to the participants, Donovan Davis Jr. instructed Capital Blu’s Controller to report a 1.6 percent gain for January 2008. Thereafter, Bromfield, Donovan Davis Jr. and Blayne Davis developed and implemented a plan to put the money that had been lost back into the CBM FX Fund, which included raising additional funds from new participants, trading aggressively and falsifying statements to participants.

At roughly this same time, Capital Blu’s expenses began to exceed its revenue. At the direction of its principals, Capital Blu began to pay operating expense with money from the CBM FX Fund. These expenses included the purchase and operation of a jet.

After some short-term trading success from April to July 2008, in August 2008 the CBM FX Fund sustained millions of dollars in losses. Instead of reporting these losses, Bromfield and Donovan Davis Jr. again provided participants with falsified statements and reported a 0.16 percent profit for August 2008. Bromfield and Donovan Davis Jr. also sent participants a notice that their funds would be locked up for four months. All the while, Bromfield, Donovan Davis Jr. and Blayne Davis continued to use CBM FX Fund money to pay operating expenses, including their own salaries of $15,000 per month each. Capital Blu’s operations were shut down after the National Futures Association (NFA) conducted a surprise audit in September 2008 after receiving information from several sources, including an employee of Capital Blu.

During the trial and a subsequent damages hearing conducted on March 2, 2011 before Judge Antoon, the CFTC established that, from January 2008 through September 2008, the CBM FX Fund sustained trading losses of approximately $5.4 million and defendants misappropriated approximately $2.46 million of participants’ funds. Judge Antoon ordered the defendants to pay the amount misappropriated as restitution and ordered a civil monetary penalty equal to twice the amount that the defendants misappropriated.

The CFTC thanks the NFA for its assistance.

CFTC staff responsible for this case are Patrick M. Pericak, Daniel C. Jordan, Heather Johnson, Erica Bodin, Melissa Glasbrenner, Bobby Williams, Sandy Rim, Jessica Harris, Melissa Strom, Matthew Elkan, Eugenia Vroustouris, Kenneth McCracken, Rick Glaser and Richard Wagner.

Media Contacts

Dennis Holden

202-418-5088

Last Updated: June 16, 2011

For Release: April 7, 2009

CFTC Charges Two Florida Companies and Three Florida Men with Operating a Fraudulent Commodity Pool that Solicited Approximately $17 Million from about 100 Investors

Capital Blu Management, LLC, DD International Holdings, LLC, Donovan Davis. Jr., Blayne Davis, and Damien Bromfield Allegedly Defrauded Investors Seeking to Invest in Foreign Currency (Forex)

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it charged Donovan Davis, Jr. (D. Davis) of Palm Bay, Florida, Blayne Davis (B. Davis), of Naples, Florida, Damien Bromfield, of Ocoee, Florida, Capital Blu Management, LLC (Capital Blu) of Melbourne, Florida, and DD International Holdings, LLC (DDIH) of Palm Bay, Florida with operating a fraudulent commodity scheme involving about 100 investors and approximately $17 million solicited purportedly to invest in foreign currency (forex) futures and options.

The complaint was filed under seal on March 23, 2009, in the U.S. District Court for the Middle District of Florida. On the same day, the Honorable John Antoon II entered an order freezing defendants’ assets and preserving books and records.

As alleged, defendants told prospective investors that their funds would be pooled in the CBM FX Fund, LP (FX Fund), a commodity pool established by Capital Blu. Rather than pool investor funds, the defendants split the funds into trading of both off-exchange and on-exchange forex futures and off-exchange forex options. In addition, the defendants allegedly deposited millions of dollars into multiple Capital Blu bank accounts, where funds were commingled and misappropriated for personal use, including luxury automobiles, private jet charters and, a two-night $40,000 spree at a “gentlemen’s club.”

Ultimately, as alleged, of the $17 million solicited, $7 million was lost in trading, and millions of dollars remain unaccounted for.

To hide their fraud, the complaint alleges, D. Davis, B. Davis, and Bromfield provided investors with phony account statements misrepresenting the earnings in their accounts by showing consistent monthly profits as high as 7 percent for 12 straight months (September 2007 through August 2008). In fact, as alleged, defendants’ actual trading resulted in net losses every month.

Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC Named as Relief Defendants

According to the complaint, B. Davis withdrew more than $135,000 of the pool participants’ funds and deposited those funds into accounts held in the name of one or more of Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC, all of whom have been named in the CFTC complaint as relief defendants. None of these entities provided legitimate services to the FX Fund and have no legitimate entitlement to the funds they received.

In its continuing litigation, the CFTC seeks restitution, disgorgement of ill-gotten gains, civil monetary penalties, and permanent injunctions against further trading.

The CFTC’s Division of Enforcement would like to thank the National Futures Association and the State of Florida Office of Financial Regulation in Orlando, Florida for their assistance.

The following Division of Enforcement staff members are responsible for this case: Daniel Jordan, Kenneth McCracken, Michael Loconte, and Rick Glaser.

Last Updated: April 7, 2009

June 15, 2011

Federal Court in Florida Orders Capital Blu Management, LLC, Donovan Davis Jr., Damien Bromfield, Blayne Davis and DD International Holdings, LLC to Pay More than $17 Million for Committing Fraud

Ruling follows a verdict returned after three-week jury trial in Orlando, Florida.

Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced that the Honorable Judge John Antoon II of the U.S. District Court for the Middle District of Florida ordered Capital Blu Management, LLC (Capital Blu) of Melbourne, Fla., Donovan Davis Jr. of Palm Bay, Fla., Damien Bromfield of Ocoee, Fla., Blayne Davis of Naples, Fla., and DD International Holdings, LLC (DDIH) of Palm Bay, Fla., jointly and severally to pay restitution of $2,463,592.12. Judge Antoon ordered Bromfield and Blayne Davis each to pay a civil monetary penalty of $4,927,184.24 and ordered Donovan Davis Jr. and DDIH jointly and severally to pay a civil monetary penalty of the same amount.

The federal order, entered on June 9, 2011, also permanently bars all defendants from engaging in any commodity-related activity, including trading and registering with the CFTC.

The order follows a verdict returned on February 3, 2011 against Donovan Davis Jr. and Bromfield by a jury in Orlando, Fla., that heard testimony and arguments for almost three weeks. In 2009, the CFTC charged the defendants with operating a fraudulent commodity pool that solicited approximately $17 million from about 100 investors purportedly to invest in off-exchange foreign currency futures (see CFTC Press Release 5643-09, April 7, 2009).

According to the evidence adduced at trial, Donovan Davis Jr. (through his wholly owned company, DDIH) and Bromfield were two of the three principals of Capital Blu, a commodity pool operator that managed a foreign currency trading fund called the CBM FX Fund, LP. Donovan Davis Jr. was Capital Blu’s Director of Corporate Affairs and Bromfield was its Director of Operations. The third principal of Capital Blu, Blayne Davis, was the Director of Trading. Because Blayne Davis, Capital Blu and DDIH did not respond to the CFTC’s complaint, the court entered default judgments against them.

According to the evidence presented at trial, Capital Blu began soliciting participants for the CBM FX Fund in August 2007 and ultimately obtained contributions from participants totaling approximately $17 million. In January 2008, the CBM FX Fund sustained losses of about $1.8 million. Instead of reporting a loss for the month to the participants, Donovan Davis Jr. instructed Capital Blu’s Controller to report a 1.6 percent gain for January 2008. Thereafter, Bromfield, Donovan Davis Jr. and Blayne Davis developed and implemented a plan to put the money that had been lost back into the CBM FX Fund, which included raising additional funds from new participants, trading aggressively and falsifying statements to participants.

At roughly this same time, Capital Blu’s expenses began to exceed its revenue. At the direction of its principals, Capital Blu began to pay operating expense with money from the CBM FX Fund. These expenses included the purchase and operation of a jet.

After some short-term trading success from April to July 2008, in August 2008 the CBM FX Fund sustained millions of dollars in losses. Instead of reporting these losses, Bromfield and Donovan Davis Jr. again provided participants with falsified statements and reported a 0.16 percent profit for August 2008. Bromfield and Donovan Davis Jr. also sent participants a notice that their funds would be locked up for four months. All the while, Bromfield, Donovan Davis Jr. and Blayne Davis continued to use CBM FX Fund money to pay operating expenses, including their own salaries of $15,000 per month each. Capital Blu’s operations were shut down after the National Futures Association (NFA) conducted a surprise audit in September 2008 after receiving information from several sources, including an employee of Capital Blu.

During the trial and a subsequent damages hearing conducted on March 2, 2011 before Judge Antoon, the CFTC established that, from January 2008 through September 2008, the CBM FX Fund sustained trading losses of approximately $5.4 million and defendants misappropriated approximately $2.46 million of participants’ funds. Judge Antoon ordered the defendants to pay the amount misappropriated as restitution and ordered a civil monetary penalty equal to twice the amount that the defendants misappropriated.

The CFTC thanks the NFA for its assistance.

CFTC staff responsible for this case are Patrick M. Pericak, Daniel C. Jordan, Heather Johnson, Erica Bodin, Melissa Glasbrenner, Bobby Williams, Sandy Rim, Jessica Harris, Melissa Strom, Matthew Elkan, Eugenia Vroustouris, Kenneth McCracken, Rick Glaser and Richard Wagner.

Media Contacts

Dennis Holden

202-418-5088

Last Updated: June 16, 2011

For Release: April 7, 2009

CFTC Charges Two Florida Companies and Three Florida Men with Operating a Fraudulent Commodity Pool that Solicited Approximately $17 Million from about 100 Investors

Capital Blu Management, LLC, DD International Holdings, LLC, Donovan Davis. Jr., Blayne Davis, and Damien Bromfield Allegedly Defrauded Investors Seeking to Invest in Foreign Currency (Forex)

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it charged Donovan Davis, Jr. (D. Davis) of Palm Bay, Florida, Blayne Davis (B. Davis), of Naples, Florida, Damien Bromfield, of Ocoee, Florida, Capital Blu Management, LLC (Capital Blu) of Melbourne, Florida, and DD International Holdings, LLC (DDIH) of Palm Bay, Florida with operating a fraudulent commodity scheme involving about 100 investors and approximately $17 million solicited purportedly to invest in foreign currency (forex) futures and options.

The complaint was filed under seal on March 23, 2009, in the U.S. District Court for the Middle District of Florida. On the same day, the Honorable John Antoon II entered an order freezing defendants’ assets and preserving books and records.

As alleged, defendants told prospective investors that their funds would be pooled in the CBM FX Fund, LP (FX Fund), a commodity pool established by Capital Blu. Rather than pool investor funds, the defendants split the funds into trading of both off-exchange and on-exchange forex futures and off-exchange forex options. In addition, the defendants allegedly deposited millions of dollars into multiple Capital Blu bank accounts, where funds were commingled and misappropriated for personal use, including luxury automobiles, private jet charters and, a two-night $40,000 spree at a “gentlemen’s club.”

Ultimately, as alleged, of the $17 million solicited, $7 million was lost in trading, and millions of dollars remain unaccounted for.

To hide their fraud, the complaint alleges, D. Davis, B. Davis, and Bromfield provided investors with phony account statements misrepresenting the earnings in their accounts by showing consistent monthly profits as high as 7 percent for 12 straight months (September 2007 through August 2008). In fact, as alleged, defendants’ actual trading resulted in net losses every month.

Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC Named as Relief Defendants

According to the complaint, B. Davis withdrew more than $135,000 of the pool participants’ funds and deposited those funds into accounts held in the name of one or more of Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC, all of whom have been named in the CFTC complaint as relief defendants. None of these entities provided legitimate services to the FX Fund and have no legitimate entitlement to the funds they received.

In its continuing litigation, the CFTC seeks restitution, disgorgement of ill-gotten gains, civil monetary penalties, and permanent injunctions against further trading.

The CFTC’s Division of Enforcement would like to thank the National Futures Association and the State of Florida Office of Financial Regulation in Orlando, Florida for their assistance.

The following Division of Enforcement staff members are responsible for this case: Daniel Jordan, Kenneth McCracken, Michael Loconte, and Rick Glaser.

Last Updated: April 7, 2009

June 15, 2011

Federal Court in Florida Orders Capital Blu Management, LLC, Donovan Davis Jr., Damien Bromfield, Blayne Davis and DD International Holdings, LLC to Pay More than $17 Million for Committing Fraud

Ruling follows a verdict returned after three-week jury trial in Orlando, Florida.

Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced that the Honorable Judge John Antoon II of the U.S. District Court for the Middle District of Florida ordered Capital Blu Management, LLC (Capital Blu) of Melbourne, Fla., Donovan Davis Jr. of Palm Bay, Fla., Damien Bromfield of Ocoee, Fla., Blayne Davis of Naples, Fla., and DD International Holdings, LLC (DDIH) of Palm Bay, Fla., jointly and severally to pay restitution of $2,463,592.12. Judge Antoon ordered Bromfield and Blayne Davis each to pay a civil monetary penalty of $4,927,184.24 and ordered Donovan Davis Jr. and DDIH jointly and severally to pay a civil monetary penalty of the same amount.

The federal order, entered on June 9, 2011, also permanently bars all defendants from engaging in any commodity-related activity, including trading and registering with the CFTC.

The order follows a verdict returned on February 3, 2011 against Donovan Davis Jr. and Bromfield by a jury in Orlando, Fla., that heard testimony and arguments for almost three weeks. In 2009, the CFTC charged the defendants with operating a fraudulent commodity pool that solicited approximately $17 million from about 100 investors purportedly to invest in off-exchange foreign currency futures (see CFTC Press Release 5643-09, April 7, 2009).

According to the evidence adduced at trial, Donovan Davis Jr. (through his wholly owned company, DDIH) and Bromfield were two of the three principals of Capital Blu, a commodity pool operator that managed a foreign currency trading fund called the CBM FX Fund, LP. Donovan Davis Jr. was Capital Blu’s Director of Corporate Affairs and Bromfield was its Director of Operations. The third principal of Capital Blu, Blayne Davis, was the Director of Trading. Because Blayne Davis, Capital Blu and DDIH did not respond to the CFTC’s complaint, the court entered default judgments against them.

According to the evidence presented at trial, Capital Blu began soliciting participants for the CBM FX Fund in August 2007 and ultimately obtained contributions from participants totaling approximately $17 million. In January 2008, the CBM FX Fund sustained losses of about $1.8 million. Instead of reporting a loss for the month to the participants, Donovan Davis Jr. instructed Capital Blu’s Controller to report a 1.6 percent gain for January 2008. Thereafter, Bromfield, Donovan Davis Jr. and Blayne Davis developed and implemented a plan to put the money that had been lost back into the CBM FX Fund, which included raising additional funds from new participants, trading aggressively and falsifying statements to participants.

At roughly this same time, Capital Blu’s expenses began to exceed its revenue. At the direction of its principals, Capital Blu began to pay operating expense with money from the CBM FX Fund. These expenses included the purchase and operation of a jet.

After some short-term trading success from April to July 2008, in August 2008 the CBM FX Fund sustained millions of dollars in losses. Instead of reporting these losses, Bromfield and Donovan Davis Jr. again provided participants with falsified statements and reported a 0.16 percent profit for August 2008. Bromfield and Donovan Davis Jr. also sent participants a notice that their funds would be locked up for four months. All the while, Bromfield, Donovan Davis Jr. and Blayne Davis continued to use CBM FX Fund money to pay operating expenses, including their own salaries of $15,000 per month each. Capital Blu’s operations were shut down after the National Futures Association (NFA) conducted a surprise audit in September 2008 after receiving information from several sources, including an employee of Capital Blu.

During the trial and a subsequent damages hearing conducted on March 2, 2011 before Judge Antoon, the CFTC established that, from January 2008 through September 2008, the CBM FX Fund sustained trading losses of approximately $5.4 million and defendants misappropriated approximately $2.46 million of participants’ funds. Judge Antoon ordered the defendants to pay the amount misappropriated as restitution and ordered a civil monetary penalty equal to twice the amount that the defendants misappropriated.

The CFTC thanks the NFA for its assistance.

CFTC staff responsible for this case are Patrick M. Pericak, Daniel C. Jordan, Heather Johnson, Erica Bodin, Melissa Glasbrenner, Bobby Williams, Sandy Rim, Jessica Harris, Melissa Strom, Matthew Elkan, Eugenia Vroustouris, Kenneth McCracken, Rick Glaser and Richard Wagner.

Media Contacts

Dennis Holden

202-418-5088

Last Updated: June 16, 2011

For Release: April 7, 2009

CFTC Charges Two Florida Companies and Three Florida Men with Operating a Fraudulent Commodity Pool that Solicited Approximately $17 Million from about 100 Investors

Capital Blu Management, LLC, DD International Holdings, LLC, Donovan Davis. Jr., Blayne Davis, and Damien Bromfield Allegedly Defrauded Investors Seeking to Invest in Foreign Currency (Forex)

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) announced today that it charged Donovan Davis, Jr. (D. Davis) of Palm Bay, Florida, Blayne Davis (B. Davis), of Naples, Florida, Damien Bromfield, of Ocoee, Florida, Capital Blu Management, LLC (Capital Blu) of Melbourne, Florida, and DD International Holdings, LLC (DDIH) of Palm Bay, Florida with operating a fraudulent commodity scheme involving about 100 investors and approximately $17 million solicited purportedly to invest in foreign currency (forex) futures and options.

The complaint was filed under seal on March 23, 2009, in the U.S. District Court for the Middle District of Florida. On the same day, the Honorable John Antoon II entered an order freezing defendants’ assets and preserving books and records.

As alleged, defendants told prospective investors that their funds would be pooled in the CBM FX Fund, LP (FX Fund), a commodity pool established by Capital Blu. Rather than pool investor funds, the defendants split the funds into trading of both off-exchange and on-exchange forex futures and off-exchange forex options. In addition, the defendants allegedly deposited millions of dollars into multiple Capital Blu bank accounts, where funds were commingled and misappropriated for personal use, including luxury automobiles, private jet charters and, a two-night $40,000 spree at a “gentlemen’s club.”

Ultimately, as alleged, of the $17 million solicited, $7 million was lost in trading, and millions of dollars remain unaccounted for.

To hide their fraud, the complaint alleges, D. Davis, B. Davis, and Bromfield provided investors with phony account statements misrepresenting the earnings in their accounts by showing consistent monthly profits as high as 7 percent for 12 straight months (September 2007 through August 2008). In fact, as alleged, defendants’ actual trading resulted in net losses every month.

Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC Named as Relief Defendants

According to the complaint, B. Davis withdrew more than $135,000 of the pool participants’ funds and deposited those funds into accounts held in the name of one or more of Nakano Capital Partners, LP, Nakano Capital Advisors, LLC, and/or Nakano Capital Management, LLC, all of whom have been named in the CFTC complaint as relief defendants. None of these entities provided legitimate services to the FX Fund and have no legitimate entitlement to the funds they received.

In its continuing litigation, the CFTC seeks restitution, disgorgement of ill-gotten gains, civil monetary penalties, and permanent injunctions against further trading.

The CFTC’s Division of Enforcement would like to thank the National Futures Association and the State of Florida Office of Financial Regulation in Orlando, Florida for their assistance.

The following Division of Enforcement staff members are responsible for this case: Daniel Jordan, Kenneth McCracken, Michael Loconte, and Rick Glaser.

Last Updated: April 7, 2009

June 15, 2011

Federal Court in Florida Orders Capital Blu Management, LLC, Donovan Davis Jr., Damien Bromfield, Blayne Davis and DD International Holdings, LLC to Pay More than $17 Million for Committing Fraud

Ruling follows a verdict returned after three-week jury trial in Orlando, Florida.

Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) today announced that the Honorable Judge John Antoon II of the U.S. District Court for the Middle District of Florida ordered Capital Blu Management, LLC (Capital Blu) of Melbourne, Fla., Donovan Davis Jr. of Palm Bay, Fla., Damien Bromfield of Ocoee, Fla., Blayne Davis of Naples, Fla., and DD International Holdings, LLC (DDIH) of Palm Bay, Fla., jointly and severally to pay restitution of $2,463,592.12. Judge Antoon ordered Bromfield and Blayne Davis each to pay a civil monetary penalty of $4,927,184.24 and ordered Donovan Davis Jr. and DDIH jointly and severally to pay a civil monetary penalty of the same amount.

The federal order, entered on June 9, 2011, also permanently bars all defendants from engaging in any commodity-related activity, including trading and registering with the CFTC.

The order follows a verdict returned on February 3, 2011 against Donovan Davis Jr. and Bromfield by a jury in Orlando, Fla., that heard testimony and arguments for almost three weeks. In 2009, the CFTC charged the defendants with operating a fraudulent commodity pool that solicited approximately $17 million from about 100 investors purportedly to invest in off-exchange foreign currency futures (see CFTC Press Release 5643-09, April 7, 2009).

According to the evidence adduced at trial, Donovan Davis Jr. (through his wholly owned company, DDIH) and Bromfield were two of the three principals of Capital Blu, a commodity pool operator that managed a foreign currency trading fund called the CBM FX Fund, LP. Donovan Davis Jr. was Capital Blu’s Director of Corporate Affairs and Bromfield was its Director of Operations. The third principal of Capital Blu, Blayne Davis, was the Director of Trading. Because Blayne Davis, Capital Blu and DDIH did not respond to the CFTC’s complaint, the court entered default judgments against them.

According to the evidence presented at trial, Capital Blu began soliciting participants for the CBM FX Fund in August 2007 and ultimately obtained contributions from participants totaling approximately $17 million. In January 2008, the CBM FX Fund sustained losses of about $1.8 million. Instead of reporting a loss for the month to the participants, Donovan Davis Jr. instructed Capital Blu’s Controller to report a 1.6 percent gain for January 2008. Thereafter, Bromfield, Donovan Davis Jr. and Blayne Davis developed and implemented a plan to put the money that had been lost back into the CBM FX Fund, which included raising additional funds from new participants, trading aggressively and falsifying statements to participants.

At roughly this same time, Capital Blu’s expenses began to exceed its revenue. At the direction of its principals, Capital Blu began to pay operating expense with money from the CBM FX Fund. These expenses included the purchase and operation of a jet.

After some short-term trading success from April to July 2008, in August 2008 the CBM FX Fund sustained millions of dollars in losses. Instead of reporting these losses, Bromfield and Donovan Davis Jr. again provided participants with falsified statements and reported a 0.16 percent profit for August 2008. Bromfield and Donovan Davis Jr. also sent participants a notice that their funds would be locked up for four months. All the while, Bromfield, Donovan Davis Jr. and Blayne Davis continued to use CBM FX Fund money to pay operating expenses, including their own salaries of $15,000 per month each. Capital Blu’s operations were shut down after the National Futures Association (NFA) conducted a surprise audit in September 2008 after receiving information from several sources, including an employee of Capital Blu.

During the trial and a subsequent damages hearing conducted on March 2, 2011 before Judge Antoon, the CFTC established that, from January 2008 through September 2008, the CBM FX Fund sustained trading losses of approximately $5.4 million and defendants misappropriated approximately $2.46 million of participants’ funds. Judge Antoon ordered the defendants to pay the amount misappropriated as restitution and ordered a civil monetary penalty equal to twice the amount that the defendants misappropriated.

The CFTC thanks the NFA for its assistance.

CFTC staff responsible for this case are Patrick M. Pericak, Daniel C. Jordan, Heather Johnson, Erica Bodin, Melissa Glasbrenner, Bobby Williams, Sandy Rim, Jessica Harris, Melissa Strom, Matthew Elkan, Eugenia Vroustouris, Kenneth McCracken, Rick Glaser and Richard Wagner.

Media Contacts

Dennis Holden

202-418-5088

Last Updated: June 16, 2011