The Commodity Futures Trading Commission

From March 2013 and continuing through at least June 2017 (the "Relevant Period"), Defendant Omega Knight 2, LLC ("Omega Knight"), by and through the actions of its owner, employees, and agents, including Defendants Aviv Michael Hen ("Aviv Hen") and Erez Hen ("Eric Hen") (collectively, "Defendants"), engaged in a scheme to defraud customers located throughout the United States in connection with precious metals transactions. Defendants offered to enter into, and conducted an office or business in the United States for the purpose of soliciting or accepting orders for, the purchase or sale of precious metals from customers on a leveraged or financed basis (collectively, "leveraged precious metals transactions" or "retail commodity transactions") and on a fully-paid basis ("fully-paid precious metals transactions"). Defendants made numerous false statements to induce customers to enter into leveraged and fully-paid precious metals transactions, and Defendants received at least $5.5 million from at least 90 customers in connection with these transactions. Defendants' leveraged precious metals transactions never resulted in actual delivery of the full amount of metal purchased to customers. In addition, Defendants used only part of the total funds collected from customers to purchase precious metals for those customers' fully-paid precious metals transactions. Instead, Defendants misappropriated customer funds to pay personal expenses, to distribute purported "profits" and disbursements to other customers, and to fund Omega Knight's operations. Through the issuance of false trade confirmations and account statements and other communications to customers, Defendants concealed their misappropriation and fraudulent scheme. In addition, Defendants' leveraged precious metals transactions constituted illegal, off-exchange retail commodity transactions. As part of Defendants' scam, Omega Knight acted as an unregistered futures commission merchant ("FCM") by engaging in these transactions without being registered as required by law. By this conduct, Defendant has engaged, is engaging, or is about to engage in conduct that violates Sections 4(a), 4b(a)(2)(A)-(C), 4d(a)(1), and 6(c)(1) of the Commodity Exchange Act, 7 U.S.C. 6(a), 6b(a)(2)(A)-(C), 6d(a)(1), and 9(1) (2012), and Commission Regulation ("Regulation") 180.1(a) (2017), 17 C.F.R. 180.1(a) (2017). Aviv Hen controlled Omega Knight throughout the Relevant Period and failed to act in good faith or knowingly induced Omega Knight's violations alleged herein. He is therefore liable for Omega Knight's violations as a controlling person pursuant to Section 13(b) of the Act, 7 U.S.C. 13c(b) (2012).

Judgment Rendered

Civil and Administrative Penalty(ies)/Fine(s)

Disgorgement

$3,814,257.00

Injunction

restrained; prohibited; post-judgment interest

FINRA

RESPONDENT HEN FAILED TO COMPLY WITH AN ARBITRATION AWARD OR SETTLEMENT AGREEMENT OR TO SATISFACTORILY RESPOND TO A FINRA REQUEST TO PROVIDE INFORMATION CONCERNING THE STATUS OF COMPLIANCE.

LETTER

Suspension

ANY CAPACITY

N/A

7/13/2015

PURSUANT TO ARTICLE VI, SECTION 3 OF FINRA BY-LAWS, AND FINRA RULE 9554, RESPONDENT HEN IS SUSPENDED ON JULY 13, 2015 FOR FAILURE TO COMPLY WITH AN ARBITRATION AWARD OR SETTLEMENT AGREEMENT OR TO SATISFACTORILY RESPOND TO A FINRA REQUEST TO PROVIDE INFORMATION CONCERNING THE STATUS OF COMPLIANCE.

BREACH OF CONTRACT, BREACH OF FIDUCIARY DUTY, UNSUITABILITY, FRAUD, VIOLATION OF FEDERAL SECURITIES LAWS AND COMMON LAW,

$328,634.00

The Award has not been paid.

CONNECTICUT

ON APRIL 19, 2011, THE BANKING COMMISSIONER ENTERED A CONSENT ORDER (NO. CO-11-7712-S) WITH RESPECT TO AVIV MICHAEL HEN. AVIV HEN WAS PREVIOUSLY REGISTERED AS A BROKER-DEALER AGENT OF ANDREW GARRETT INC. IN CONNECTICUT. THE CONSENT ORDER ALLEGED THAT, FROM AT LEAST JANUARY 2009 AND WHILE EMPLOYED AS A BROKER-DEALER AGENT OF ANDREW GARRETT INC., AVIV HEN ENGAGED IN DISHONEST OR UNETHICAL PRACTICES IN THE SECURITIES BUSINESS WITHIN THE MEANING OF SECTIONS 36B-15(A)(2)(H) AND 36B-4(B) OF THE CONNECTICUT UNIFORM SECURITIES ACT. SPECIFICALLY, AVIV HEN ALLEGEDLY FAILED TO FULFILL THE REQUIREMENTS IN NASD RULE 2510(D) BY EXECUTING TRANSACTIONS FOR A CONNECTICUT CLIENT UTILIZING TIME AND PRICE DISCRETION THAT HAD BEEN GRANTED TO HIM A DAY OR SEVERAL DAYS PRIOR TO THE EXECUTION OF THE TRANSACTIONS.

Consent

THE CONSENT ORDER PROHIBITED AVIV HEN FOR THREE YEARS FROM 1) EFFECTING CONNECTICUT SALES, EXCEPT FOR LIQUIDATING SALES, OF SECURITIES TRADING ON THE NASDAQ BULLETIN BOARD OR LISTED FOR QUOTATION ON THE PINK SHEETS; 2) OPENING NEW CONNECTICUT ACCOUNTS APPROVED FOR OPTIONS TRADING UNLESS THE CONNECTICUT CUSTOMER WAS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(A) OF REGULATION D UNDER THE SECURITIES ACT OF 1933; 3) OPENING NEW CONNECTICUT MARGIN ACCOUNTS UNLESS THE CONNECTICUT CUSTOMER WAS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(A) OF REGULATION D; AND 4) OPENING OR MAINTAINING ANY DISCRETIONARY ACCOUNTS FOR CONNECTICUT CLIENTS.