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UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

COMMODITY FUTURES TRADING 

COMMISSION, 

Plaintiff, 

V. 

DRO KHOLAMIAN 

and 

BLUE STAR TRADING, LLC, 

Defendants. 

) 

) 

) 

) 

) 

) 

) Case No.: 18-cv-0797 

) 

) Judge Sara L. Ellis 

) 

) 

) 

) 

) 

) 

________________ ) 

CONSENT ORDER FOR PERMANENT INJUNCTION, CIVIL MONETARY PENAL TY 

AND OTHER EQUITABLE RELIEF AGAINST DEFENDANTS DRO KHOLAMIAN 

and BLUE STAR TRADING, LLC 

I. INTRODUCTION 

On November 20, 2018, Plaintiff Commodity Futures Trading Commission 

("Commission" or "CFTC") filed a Complaint against Defendants Dro Kholamian 

("Kholamian") and Blue Star Trading, LLC ("Blue Star") ( or collectively "Defendants") seeking 

injunctive and other equitable relief, as well as the imposition of civil penalties, for violations of 

the Commodity Exchange Act ("Act"), 7 U.S.C. §§ 1-26 (2018), and the Commission's 

Regulations ("Regulations") promulgated thereunder, 17 C.F .R. pts. 1-190 (2020). The Court 

entered an ex parte statutory restraining order against Kholamian and Blue Star on November 30, 

2018 and a Consent Order for Preliminary Injunction and Other Ancillary Relief Against 

Defendants Kholamian and Blue Star on December 13, 2018. 
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II. CONSENTS AND AGREEMENTS 

To effect settlement of all charges alleged in the Complaint against Defendants without a 

trial on the merits or any further judicial proceedings, Defendants Kholamian and Blue Star: 

1. Consent to the entry of this Consent Order for Permanent Injunction, Civil 

Monetary Penalty, and Other Equitable Relief Against Defendants Kholamian and Blue Star 

("Consent Order"); 

2. Affirm that they have read and agreed to this Consent Order voluntarily, and that 

no promise, other than as specifically contained herein, or threat, has been made by the 

Commission or any member, officer, agent, or representative thereof, or by any other person, to 

induce consent to this Consent Order; 

3. Acknowledge service of the summons and Complaint; 

4. Admit the jurisdiction of this Court over them and the subject matter of this action 

pursuant to Section 6c of the Act, 7 U.S.C. § 13a-1 (2018); 

5. Admit the jurisdiction of the Commission over the conduct and transactions at 

issue in this action pursuant to the Act; 

6. Admit that venue properly lies with this Court pursuant to 7 U.S.C. § 13a-l(e); 

7. Waive: 

(a) Any and all claims that they may possess under the Equal Access to 

Justice Act, 5 U.S.C. § 504 (2018) and 28 U.S.C. § 2412 (2018), and/or 

the rules promulgated by the Commission in conformity therewith, Part 

148 of the Regulations, 17 C.F.R. pt. 148 (2020), relating to, or arising 

from, this action; 

(b) Any and all claims that they may possess under the Small Business 

Regulatory Enforcement Fairness Act of 1996, Pub. L. No. 104-121, tit. II, 

§§ 201-53, 110 Stat. 847, 857-74 (codified as amended at 28 U.S.C. 

§ 2412 and in scattered sections of 5 U.S.C. and 15 U.S.C.), relating to, or 

arising from, this action; 

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( c) Any claim of Double Jeopardy based upon the institution of this action or 

the entry in this action of any order imposing a civil monetary penalty or 

any other relief, including this Consent Order; and 

( d) Any and all rights of appeal from this action; 

8. Consent to the continued jurisdiction of this Court over them for the purpose of 

implementing and enforcing the terms and conditions of this Consent Order and for any other 

purpose relevant to this action, even if Defendants Kholamian or Blue Star now or in the future 

resides outside the jurisdiction of this Court; 

9. Agree that they will not oppose enforcement of this Consent Order on the ground, 

if any exists, that it fails to comply with Rule 65(d) of the Federal Rules of Civil Procedure and 

hereby waives any objection based thereon; 

10. Agree that neither they nor any of their agents or employees under their authority 

or control shall take any action or make any public statement denying, directly or indirectly, any 

allegation in the Complaint or the Findings of Fact or Conclusions of Law in this Consent Order, 

or creating or tending to create the impression that the Complaint and/or this Consent Order is 

without a factual basis; provided, however, that nothing in this provision shall affect their: 

(a) testimonial obligations, or (b) right to take legal positions in other proceedings to which the 

Commission is not a party. Defendants shall comply with this agreement, and shall undertake all 

steps necessary to ensure that all of their agents and/or employees under their authority or control 

understand and comply with this agreement; 

11. Admit to all of the findings made in this Consent Order and all of the allegations 

in the Complaint. 

12. In United States v. Dro Kholamian, No. 20 CR 530 (N.D. Ill.) (June 3, 2021) 

("Criminal Action"), Kholamian pleaded guilty to violating 18 U.S.C. § 1343 (Count One), and 

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in connection with that plea, on June 3, 2021, entered into a plea agreement [ECF No.29]. In 

connection with that plea, Kholamian admitted the facts recited in the plea agreement and in 

Count One of the criminal indictment that charged him on August 20, 2020 with wire fraud and 

violating 18 U.S.C.§1343 [ECF No. 1], and those same facts are admitted as if set forth in this 

Order. Copies of the plea agreement and criminal indictment are attached as Exhibits A and B to 

this Order; 

13. Consent to the use of the findings and conclusions in this Consent Order in this 

proceeding and in any other proceeding brought by the Commission or to which the Commission 

is a party or claimant, and agrees that they shall be taken as true and correct and be given 

preclusive effect therein, without further proof; 

14. Do not consent, however, to the use of this Consent Order, or the findings and 

conclusions herein, as the sole basis for any other proceeding brought by the Commission or to 

which the Commission is a party, other than a: statutory disqualification proceeding; proceeding 

in bankruptcy, or receivership; or proceeding to enforce the terms of this Order; 

15. Agree to provide immediate notice to this Court and the Commission by certified 

mail, in the manner required by paragraph 94 of Part V. D. of this Consent Order, of any 

bankruptcy proceeding filed by, on behalf of, or against them, whether inside or outside the 

United States; and 

16. Agree that no provision of this Consent Order shall in any way limit or impair the 

ability of any other person or entity to seek any legal or equitable remedy against Defendants 

Kholamian or Blue Star in any other proceeding. 

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III. FINDINGS OF FACT AND CONCLUSIONS OF LAW 

The Court, being fully advised in the premises, finds that there is good cause for the entry 

of this Consent Order and that there is no just reason for delay. The Court therefore directs the 

entry of the following Findings of Fact, Conclusions of Law, permanent injunction and equitable 

relief pursuant to Section 6c of the Act, 7 U.S.C. § 13a-1 (2018), as set forth herein. 

THE PARTIES AGREE AND THE COURT HEREBY FINDS: 

A. Findings of Fact 

The Parties to this Consent Order 

17. Plaintiff Commodity Futures Trading Commission is an independent federal 

regulatory agency that is charged by Congress with administering and enforcing the Act and the 

Regulations. 

18. Defendant Dro Kholamian resides in Barrington, Illinois. Kholamian is the 

president and a managing member of Blue Star, and a signatory on Blue Star's bank accounts. 

Kholamian is not currently registered with the Commission in any capacity, but was registered 

with the Commission as an associated person of various firms from November 14, 2003 to 

November 17, 2008, and as a floor broker from July 20, 2013, until he withdrew that registration 

on September 2, 2016. 

19. Defendant Blue Star Trading, LLC became a limited liability corporation in the 

state of Illinois on January 1, 2009 and was involuntarily dissolved on April 10, 2015. Its 

principal place of business was in Park Ridge, Illinois. Blue Star has never been registered in 

any capacity with the Commission. 

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Overview of Kholamian's Trading Activity 

20. From January 2013 to the time of filing of this lawsuit (the "Relevant Period"), 

Kholamian had proprietary trading accounts in his own name where he traded commodity futures 

contracts at several futures commission merchants ("FCMs"). 

21. Kholamian' s proprietary trading accounts at these FCMs had deposits in the 

aggregate sum of $209,764. Kholamian withdrew $55,535 from his trading accounts and lost 

$153,838 overall trading commodity futures contracts. As of October 31, 2018, Kholamian had 

a total remaining balance of $591.14 in three FCM accounts. 

22. Blue Star never had any trading accounts in its name at any registered FCMs. 

Solicitation Fraud 

23. Kholamian sought out clients who would agree to let him trade forex and 

commodity futures contracts on their behalf through his company, Blue Star. Kholamian 

approached potential clients at his Armenian church located in Glenview, Illinois, and through 

word of mouth and social contacts to U.S. citizens, primarily those of Armenian heritage. 

24. The clients Kholamian approached were not eligible contract participants 

("ECPs") as defined under Section la(18)(xi) of the Act, 7 U.S.C. § la(18)(xi) (2018), in that 

they did not possess amounts invested on a discretionary basis, the aggregate amount of which 

was in excess of $10 million, or possess aggregate amounts in excess of $5 million and enter into 

agreements, contracts, or transactions in order to manage risk. 

25. Kholamian told prospective clients that he would trade for them through his 

company, Blue Star, which had a physical office location in Park Ridge, Illinois. He also told 

them that he had been a trader for more than 32 years and had worked with "millions of dollars." 

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In addition, he told at least one prospective client that he had $500,000 to $700,000 of client 

funds under management. 

26. In connection with his operation of Blue Star and solicitation of prospective 

clients for trading forex and commodity futures contracts in managed accounts, Kholamian 

promised prospective clients: 

(a) That he would generate for them a 10-20% profit on a $25,000 investment within 

one year; and 

(b) That they could withdraw their funds at any time, without penalty. 

27. After having accepted client funds, Kholamian represented that existing 

investments were "doing well" and were on target to make a 20% return after one year. 

28. In fact, Kholamian did not deposit all of his clients' funds in any forex or 

commodity futures accounts and he, instead, knowingly misappropriated at least a portion of 

their funds. Further, Kholamian knew, or was reckless in not knowing, that his proprietary 

trading accounts had lost $153,979 overall during the relevant period. 

Misappropriation of Client Funds 

29. The Defendants received $995,000 in Kholamian's personal account from seven 

clients for futures and/or forex trading. Defendants returned $768,000 to those clients through 

his personal account and the Blue Star account and misappropriated $227,000 of their funds. 

Kholamian used the misappropriated funds to pay other clients and for his personal and business 

expenses, including making cash transfers to his personal bank accounts. 

30. An illustration ofKholamian's misappropriation involves a deposit made by 

Client GG, a non-ECP, on September 30, 2016. In connection with Kholamian's solicitation, 

Client GG understood that his funds would be used to trade commodity futures and forex in his 

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account that would be set up for him and managed by Kholamian. Client GG followed 

instructions given to him by Kholamian and sent a $25,000 wire payable to Kholamian's 

personal bank account to fund his investment for trading forex and commodity futures. 

Kholamian did not send Client GG's funds to a trading account and, instead, used some of Client 

GG's funds to withdraw $6,000 cash on the day that he received Client GG's funds. Although 

Kholamian paid Client GG the sum of $5,000 in "profits," via a check drawn from the Blue Star 

bank account, Kholamian made up various excuses when Client GG demanded the return of his 

$25,000 principal, claiming, among other excuses, that he was "stuck in a trade." Eventually, 

Kholamian gave Client GG a $25,000 check drawn on the Blue Star bank account that could not 

be negotiated due to insufficient funds. Thereafter, Kholamian told Client GG that he had "lost 

the money." Kholamian has not returned any of Client GG's remaining deposit to him. 

31. Another illustration of Kholamian' s misappropriation involves an investment 

made by Client DG, a non-ECP, who invested $25,000 intended for trading forex and 

commodity futures on December 7, 2016. Client DG sent a wire payable to Kholamian's 

personal bank account, as he had been directed to do by Kholamian. Kholamian did not send 

Client DG's funds to any trading account. Rather, he used $15,000 of Client DG's funds to pay 

another client the same day that he received Client DG's funds. When Client DG later 

demanded the return of his funds, Kholamian told him that he could not get his money because it 

was "tied up in trades." After Client DG made repeated demands, Kholamian sent him a check 

for $30,000 drawn on the Blue Star account that could not be negotiated due to insufficient 

funds. In late 2017, Kholamian told Client DG that he was "going through a rough time." Client 

DG has not received the return of any of his deposit from Kholamian. 

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32. Neither Client GG's funds nor Client DG's funds were ever used for forex or 

commodity trading purposes and their funds were, instead, misappropriated by Kholamian for his 

own business and personal expenses. 

Kholamian Acted as Controlling Person for Blue Star 

33. During the Relevant Period, Kholamian controlled all aspects of Blue Star's 

operations. Kholamian conducted all solicitations with prospective clients on behalf of Blue 

Star, engaged in all communications with clients, and made all financial and strategic decisions 

for Blue Star by directing, among other things, the opening of bank accounts and signing of 

checks on behalf of Blue Star, the payment of Blue Star's operating expenses, and the deposit 

and withdrawals of client funds from Blue Star accounts. 

B. Conclusions of Law 

Jurisdiction and Venue 

34. This Court possesses jurisdiction over this action pursuant to 28 U.S.C. § 1331 

(2018) (codifying federal question jurisdiction) and 28 U.S.C. § 1345 (2018) (providing that U.S. 

district courts have original jurisdiction over civil actions commenced by the United States or by 

any agency expressly authorized to sue by Act of Congress). Section 6c(a) of the Act, 7 U.S.C. 

§ 13a-l(a) (2018), provides that the Commission may bring actions for injunctive relief or to 

enforce compliance with the Act or any rule, regulation, or order thereunder in the proper district 

court of the United States whenever it shall appear to the Commission that any person has 

engaged, is engaging, or is about to engage in any act or practice constituting a violation of any 

provision of the Act or any rule, regulation, or order thereunder. 

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35. Venue properly lies with this Court pursuant to 7 U.S.C. § 13a-l(e), because 

Defendants reside in this jurisdiction and the acts and practices in violation of the Act occurred 

within this District. 

Fraud in Connection with Commodity Futures Transactions by Fraudulent 

Solicitation and Misappropriation 

36. Section 4b(a)(l)(A) and (C) of the Act, 7 U.S.C. § 6b(a)(l)(A), (C) (2018), makes 

it unlawful for any person, in or in connection with any order to make or the making of any 

contract of sale of any futures contract to cheat, defraud or willfully deceive, or attempt to cheat, 

defraud, or willfully deceive any other person by any means whatsoever in regard to any order or 

contract or the disposition or execution of any order or contract, or in regard to any act of agency 

performed, with respect to any order or contract for such other person. 

37. During the relevant period, Defendants violated 7 U.S.C. § 6b (a)(l)(A) and (C) 

by, among other things: 

(1) Falsely promising to clients that they would generate a 10-20% return on a 

$25,000 investment within one year; 

(2) Falsely promising to clients that they could withdraw their funds at any time, 

without penalty; 

(3) Telling clients that their existing investments were "doing well" and were on 

target to make a 20% return after one year; .and 

(4) Misappropriating client funds for Kholamian's personal benefit. 

38. Defendants committed the acts and practices described above using 

instrumentalities of interstate commerce, including the use of interstate wires for transfer of 

funds. 

39. Defendants committed the acts and practices described herein willfully. 

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40. Each act of misrepresentation, misappropriation and omission of material fact, 

constitutes a separate and distinct violation of 7 U.S.C. § 6b(a)(l)(A) and (C). 

41. The foregoing acts, omissions and failures ofKholamian, and all other agents of 

Blue Star, occurred within the scope of their employment, office or agency with Blue Star; 

therefore, Blue Star is liable for these acts, omissions and failures pursuant to Section 2(a)(l)(B) 

of the Act, 7 U.S.C. § 2(a)(l)(B) (2018), and Regulation 1.2, 17 C.F.R. § 1.2 (2020). 

42. Kholamian directly or indirectly controls Blue Star, and did not act in good faith, 

or knowingly induced, directly or indirectly, the acts constituting Blue Star's violations of 

7 U.S.C. § 6b(a)(l)(A) and (C), and is thus liable for its violations pursuant to Section 13(b) of 

the Act, 7 U.S.C. § 13c(b) (2018). 

Fraud in Connection with Forex Transactions by Fraudulent Solicitation and 

Misappropriation 

43. Section 4b(a)(2)(A) and (C) of the Act, 7 U.S.C. § 6b(a)(2)(A), (C) (2018), makes 

it unlawful for any person, in or in connection with any order to make, or the making of, any 

contract of sale of any commodity for future delivery that is made, or to be made, for or on 

behalf of, or with, any other person, other than on or subject to the rules of a designated contract 

market (A) to cheat or defraud or attempt to cheat or defraud the other person; or (C) willfully to 

deceive or attempt to deceive the other person by any means whatsoever in regard to any order or 

contract or the disposition or execution of any order or contract, or in regard to any act of agency 

performed, with respect to any order or contract for or, in the case of paragraph (2), with the 

other person. 

44. Section 2(c)(2)(C)(iv) of the Act, 7 U.S.C. § 2(c)(2)(C)(iv) (2018), provides that 

7 U.S.C. § 6b(a)(2)(A) and (C) also applies to Defendants' forex transactions "as if' they were a 

contract of sale of a commodity for future delivery. 

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45. Regulation 5.2(b)(l) and (3), 17 C.F.R. § 5.2(b)(l), (3) (2020), makes it unlawful 

for a person by use of the mails, or any means or instrumentality of interstate commerce, directly 

or indirectly, in or in connection with any retail forex transaction: (1) to cheat or defraud or 

attempt to cheat or defraud any person; or (3) willfully to deceive or attempt to deceive any 

person by any means whatsoever. 

46. During the relevant period, Defendants violated 7 U.S.C. § 6b(a)(2)(A) and (C) 

and 17 C.F.R § 5.2(b) (1) and (3), by, inter alia: 

(1) Falsely promising to clients that they would generate a 10-20% return on a 

$25,000 investment within one year; 

(2) Falsely promising to clients that they could withdraw their funds at any time, 

without penalty; 

(3) Telling clients that their existing investments were "doing well" and were on 

target to make a 20% return after one year; and 

(4) Misappropriating client funds for Kholamian's personal benefit. 

4 7. Defendants committed the acts and practices described above using 

instrumentalities of interstate commerce, including the use of interstate wires for transfer of 

funds. 

48. Defendants committed the acts and practices describes herein willfully. 

49. Each act of misrepresentation, misappropriation and omission of material fact, 

including, but not limited to, those specifically alleged herein, constitutes a separate and distinct 

violation of7 U.S.C. § 6b(a)(2)(A) and (C) and 17 C.F.R. § 5.2(b)(l) and (3). 

50. The foregoing acts, omissions and failures ofKholamian, and all other agents of 

Blue Star, occurred and are occurring within the scope of their employment, office or agency 

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with Blue Star; therefore, Blue Star is liable for these acts, omissions and failures pursuant to 

7 U.S.C. § 2(a)(l)(B) and 17 C.F.R. § 1.2. 

51. Kholamian directly or indirectly controls Blue Star, and did not act in good faith, 

or knowingly induced, directly or indirectly, the acts constituting Blue Star's violations of 

7 U.S.C. § 6b(a)(2)(A) and (C), and is thus liable for its violations pursuant to 7 U.S.C. § 13c(b) 

(2018). 

Blue Star Acted as a Commodity Trading Advisor and Kholamian Acted as Its 

Associated Person in Connection with Commodity Futures and Forex, and Both 

Engaged in Fraud 

52. In connection with commodity futures transactions, a Commodity Trading 

Advisor ("CTA") is defined, in part, in Section la(12) of the Act, 7 U.S.C. § la(12) (2018), as 

any person who: 

For compensation or profit, engages in the business of advising 

others, either directly, or through publications, writings, or 

electronic media, as to the value of or the advisability of trading in 

(1) any contract of sale of a commodity for future delivery, 

security futures product or swap; or 

(2) any agreement, contract, or transaction described in 

Section 2(c)(2)(C)(i). 

53. In connection with retail forex transactions, a CTA is defined in Regulation 

5.l(e)(l), 17 C.F.R. § 5.l(e)(l) (2020), as any person who: 

[E]xercises discretionary trading authority or obtains written 

authorization to exercise discretionary trading authority over any 

account for or on behalf of any person that is not an eligible 

contract participant as defined in section 1 a(l 8) of the Act, in 

connection with retail forex transactions. 

54. During the relevant period, Blue Star has been operating as a CTA in that it, for 

profit, engaged in the business of advising others of the advisability of trading in commodity 

futures and forex trades for profit. 

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55. In connection with commodity futures transactions, an Associated Person ("AP") 

of a CTA is defined by Regulation 1.3, 17 C.F.R. § 1.3 (2020), as any natural person who is a 

"partner, officer, employee, consultant, or agent ( or any natural person occupying a similar status 

or performing similar functions), in any capacity which involves the solicitation of a client's or 

prospective client's discretionary account." 

56. In connection with retail forex transactions, 17 C.F .R. § 5 .1 ( e )(2) defines an AP 

of a CTA as any natural person associated with a CTA as a partner, officer, employee, consultant 

or agent, in any capacity, which involves the solicitation of a client's or prospective client's 

discretionary account. Except in circumstances not relevant here, Regulation 5.3(a)(3)(ii), 

17 C.F.R. § 5.3(a)(3)(ii) (2020), requires those that meet the definition of a forex AP of a CTA to 

register with the Commission. 

57. During the relevant period, Kholamian acted as an AP of Blue Star by soliciting 

clients for discretionary trading accounts for trading commodity futures and retail forex. 

58. Section 4a(l)(A) of the Act, 7 U.S.C. § 6a(l)(A) (2018), provides, in relevant 

part, that it shall be unlawful for a CTA, or an AP of a CTA, by use of the mails or any means or 

instrumentality of interstate commerce, directly or indirectly "to employ any device, scheme or 

artifice to defraud any client ... or prospective client. ... " 

59. Section 4a(l)(B) of the Act, 7 U.S.C. § 6a(l)(B) (2018), provides, in relevant 

part, that it shall be unlawful for a CTA, or an AP of a CTA, by use of the mails or any means or 

instrumentality of interstate commerce, directly or indirectly "to engage in any transaction, 

practice, or course of business which operates as a fraud or deceit upon any client ... or 

prospective client .... " 

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60. Section 2(c)(2)(C)(ii)(I) of the Act, 7 U.S.C. § 2(c)(2)(C)(ii)(I)(2018), states, in 

part, that Section 4o of the Act, 7 U.S.C. § 60, applies to any agreement, contract, or transaction 

in foreign currency offered on a leveraged or margined basis to non ECPs. 

61. By reason of the foregoing, Defendants violated 7 U.S.C. § 60(1) (A) and (B). 

62. Each act of misrepresentation, misappropriation and omission of material fact, 

including, but not limited to, those specifically alleged herein, constitutes a separate and distinct 

violation of7 U.S.C. § 6o(l)(A) and (B). 

63. The foregoing acts, omissions and failures ofKholamian, and all other agents of 

Blue Star, occurred and are occurring within the scope of their employment, office or agency 

with Blue Star; therefore, Blue Star is liable for these acts, omissions and failures pursuant to 

7 U.S.C. § 2(a)(l)(B) and 17 C.F.R. § 1.2. 

64. Kholamian directly or indirectly controls Blue Star, and did not act in good faith, 

or knowingly induced, directly or indirectly, the acts constituting Blue Star's violations, and is 

thus liable for its violations of7 U.S.C. § 6o(l)(A) and (B) pursuant to 7 U.S.C. § 13c(b). 

Failure to Register as a CTA in connection with commodity futures and forex 

65. Section 4m(l) of the Act, 7 U.S.C. § 6m(l) (2018), makes it unlawful for any 

CT A, unless registered with the CFTC, to make use of the mails or any means or instrumentality 

of interstate commerce in connection with its business as a CTA. 

66. Section 2(c)(2)(C)(iii)(I)(bb) of the Act, 7 U.S.C. § 2(c)(2)(C)(iii)(I)(bb) (2018), 

makes it unlawful for any person, unless registered in such capacity as the CFTC shall 

determine, to exercise discretionary trading authority over any account for or on behalf of any 

person that is not an ECP, in connection with leveraged or margined forex transactions. 

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67. Regulation 5.3(a)(3)(i), 17 C.F.R. § 5.3(a)(3)(i) (2020), requires any CTA as 

defined in 17 C.F.R. § 5. l(e)(l) and in connection with leveraged or margined forex transactions, 

to register as a CT A. 

68. Blue Star has never been registered as a CTA. 

69. Blue Star does not qualify for a CTA registration exemption under either the Act 

or the Regulations. 

70. Blue Star, through the relevant period, used the mails, wires, or other 

instrumentalities of interstate commerce in or in connection with its activities as a CT A, in 

connection with commodity futures and forex trading, while failing to register as a CT A. It also 

exercised discretionary trading authority over commodity futures trading accounts for profit. 

Consequently, it violated 7 U.S.C. §§ 6m(l) and 2(c)(2)(C)(iii)(I)(bb) and 17 C.F.R. 

§ 5.3(a)(3)(i). 

71. Each instance of exercising discretionary trading authority over any commodity 

futures trading account for profit, including but not limited to those specifically alleged herein, is 

alleged as a separate and distinct violation of7 U.S.C. § 6m(l). 

72. Each instance of exercising discretionary trading authority on behalf of any 

person that is not an ECP, in connection with leveraged or margined forex transactions, including 

but not limited to those specifically alleged herein, is alleged as a separate and distinct violation 

of7 U.S.C. § 2(c)(2)(C)(iii)(I)(bb) and 17 C.F.R. § 5.3(a)(3)(i). 

73. Kholamian directly or indirectly controls Blue Star, and did not act in good faith, 

or knowingly induced, directly or indirectly, the acts constituting Blue Star's violations, and is 

thus liable for its violations of7 U.S.C. §§ 6m(l) and? U.S.C. § 2(c)(2)(C)(iii)(I)(bb) and 

17 C.F.R. § 5.3(a)(3)(i) pursuant to 7 U.S.C. § 13c(b). 

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Failure to Register as an AP of a CTA in connection with commodity futures and 

forex 

74. Section 4k(3) of the Act, 7 U.S.C. § 6k(3) (2018), makes it unlawful for any AP, 

unless registered with the CFTC, to solicit a client's or prospective client's discretionary account 

or to supervise any person or persons so engaged. 

75. Section 2(c)(2)(C)(iii)(I)(aa) of the Act, 7 U.S.C. § 2(c)(2)(C)(iii)(I)(aa) (2018), 

makes it unlawful for any person, unless registered in such capacity as the CFTC shall 

determine, to solicit or accept orders from any person that is not an ECP, in connection with 

leveraged or margined forex transactions. 

76. 17 C.F.R. § 5.3(a)(3)(ii) requires any AP as defined in 17 C.F.R. § 5.l(e)(2) and 

in connection with leveraged or margined forex transactions, to register as an AP. 

77. By reason of the conduct described above, Kholamian was a partner, officer, 

employee, consultant, or agent of Blue Star, and he was involved in the solicitation of Blue 

Star's clients' or prospective clients' discretionary accounts. 

78. Kholamian was not registered with the Commission as an AP. 

79. By reason of the foregoing, Kholamian violated 7 U.S.C. §§ 2(c)(2)(C)(iii)(I)(aa) 

and 6k(3), and 17 C.F.R. §5.3(a)(3)(ii). 

80. Each instance of soliciting clients or prospective clients' discretionary account in 

connection with commodity futures trading, including but not limited to those specifically 

alleged herein, is alleged as a separate and distinct violation of 7 U.S.C. § 6k(3). 

81. Each instance of soliciting clients or prospective clients who were not ECPs, in 

connection with leveraged or margined forex transactions, including but not limited to those 

specifically alleged herein, is alleged as a separate and distinct violation of 7 U.S.C. 

§ 2(c)(2)(C)(iii)(I)(aa) and 17 C.F.R. § 5.3(a)(3)(ii). 

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82. The foregoing acts, omissions and failures ofKholamian, and all other agents of 

Blue Star, occurred and are occurring within the scope of their employment, office or agency 

with Blue Star; therefore, Blue Star is liable for these acts, omissions and failures pursuant to 

7 U.S.C. § 2(a)(l)(B) and 17 C.F.R. § 1.2. 

83. Unless restrained and enjoined by this Court, there is a reasonable likelihood that 

Kholamian and Blue Star will continue to engage in the acts and practices alleged in the 

Complaint and in similar acts and practices in violation of the Act and Regulations. 

IV. PERMANENT INJUNCTION 

IT IS HEREBY ORDERED: 

84. Based upon and in connection with the foregoing conduct, pursuant to Section 6c 

of the Act, 7 U.S.C. § 13a-1 (2018), Kholamian and Blue Star are permanently restrained, 

enjoined and prohibited from directly or indirectly: 

a. Cheating or defrauding, or attempting to cheat or defraud, or willfully deceiving 

or attempting to deceive other persons in or in connection with any order to make, 

or the making of, any contract of sale of any commodity for future delivery that is 

made, or to be made, on or subject to the rules of a designated contract market, for 

or on behalf of any other person, in violation of Section 4b(a)(l)(A) and (C) of the 

Act, 7 U.S.C. § 6b(a)(l)(A), (C) (2018); 

b. Cheating or defrauding, or attempting to cheat or defraud, or willfully deceiving 

or attempting to deceive other persons in or in connection with any order to make, 

or the making of, any contract of sale of any commodity for future delivery, or 

swap, that is made, or to be made, for or on behalf of, or with, any other person, 

other than on or subject to the rules of a designated contract market, in violation 

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of Section 4b(a)(2)(A) and (C) of the Act, 7 U.S.C. § 6b(a)(2)(A), (C) (2018), and 

Regulation 5.2(b)(l) and (3), 17 C.F.R. § 5.2(b)(l), (3) (2020); 

c. While operating as a commodity trading advisor or an associated person of a 

commodity trading advisor, employing any device, scheme, or artifice to defraud 

any client or prospective client, or engaging in any transaction, practice, or course 

of business which operates as a fraud or deceit upon any client or participant or 

prospective client or participant, in violation of Section 4o(l )(A) and (B) of the 

Act, 7 U.S.C. §§ 6o(l)(A), (B) (2020); 

d. Making use of the mails or any means or instrumentality of interstate commerce 

in connection with its business as a CT A without registration with the CFTC as a 

CTA, in violation of Section 4m(a) of the Act, 7 U.S.C. § 6m(l) (2018), or 

exercising discretionary trading authority over any account for or on behalf of any 

person that is not an ECP in connection with leveraged or margined forex 

transactions, without registration with the CFTC as a CTA, in violation of Section 

2(c)(2)(C)(iii)(I)(bb) of the Act, 7 U.S.C. § 2(c)(2)(C)(iii)(I)(bb) (2018), and 

Regulation 5.3(a)(i), 17 C.F.R. § 5.3(a)(3)(i) (2020); and/or 

e. Soliciting a client's or prospective client's discretionary account or supervising 

any person or persons so engaged, without registration with the CFTC as an AP in 

violation of Section 4k(3) of the Act, 7 U.S.C. § 6k(3) (2018), or soliciting or 

accepting orders from any person that is not an ECP, in connection with leveraged 

or margined forex transactions, in violation of 7 U.S.C. § 2(c)(2)(C)(iii)(I)(aa) 

(2018) and 17 C.F.R. § 5.3(a)(3)(ii). 

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85. Kholamian and Blue Star are also permanently restrained, enjoined and prohibited 

from directly or indirectly: 

a. Trading on or subject to the rules of any registered entity (as that term is defined 

in Section la(40) of the Act, 7 U.S.C. § la(40) (2018); 

b. Entering into any transactions involving "commodity interests" (as that term is 

defined in Regulation 1.3, 17 C.F.R. § 1.3 (2020)) for their own personal accounts 

or for any account in which they have a direct or indirect interest; 

c. Having any commodity interests traded on their behalf; 

d. Controlling or directing the trading for or on behalf of any other person or entity, 

whether by power of attorney or otherwise, in any account involving commodity 

interests; 

e. Soliciting, receiving or accepting any funds from any person for the purpose of 

purchasing or selling any commodity interests; 

f. Applying for registration or claiming exemption from registration with the 

Commission in any capacity, and engaging in any activity requiring such 

registration or exemption from registration with the Commission, except as 

provided for in Regulation 4.14(a)(9), 17 C.F.R. § 4.14(a)(9) (2020); and/or 

g. Acting as a principal (as that term is defined in Regulation 3.l(a), 17 C.F.R. 

§ 3.l(a) (2020)), agent or any other officer or employee of any person (as that 

term is defined in Section la(38) of the Act, 7 U.S.C. § la(38) (2020)), registered, 

exempted from registration or required to be registered with the Commission 

except as provided for in 17 C.F.R. § 4.14(a)(9). 

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V. RESTITUTION AND A CIVIL MONETARY PENAL TY 

A. Restitution 

86. Defendants' violations of the Act and Regulations merit the award of restitution. 

However, this Court recognizes that the court in the Criminal Action has ordered that Defendant 

Kholamian pay restitution in the amount of Seven-hundred and fifty-five thousand dollars 

($755,000). Of that sum, Kholamian was ordered to pay a total of Two-hundred and seventyseven thousand dollars ($227,000) to the defrauded clients of Defendants Kholamian and Blue 

Star in connection with the same conduct at issue in this action. Accordingly, restitution is 

ordered against Kholamian in the amount of Two-hundred and twenty-seven thousand dollars 

($227,000), jointly and severally, with Defendant Blue Star ("Restitution Obligation") with this 

sum payable to the forex or commodity interest clients in amounts set forth on Attachment C, 

hereto. Further, any sums paid toward restitution in the criminal action to Defendants' forex or 

commodity interest clients will be credited as a dollar-for-dollar reduction against Kholamian 

and Blue Star's civil restitution obligation. 

87. The amounts payable to each client shall not limit the ability of any client from 

proving that a greater amount is owed from Defendants or any other person or entity, and 

nothing herein shall be construed in any way to limit or abridge the rights of any client that exist 

under state or common law. 

88. Pursuant to Rule 71 of the Federal Rules of Civil Procedure, each client of 

Defendants who suffered a loss is explicitly made an intended third-party beneficiary of this 

Consent Order and may seek to enforce obedience of this Consent Order to obtain satisfaction of 

any portion of the restitution that has not been paid by Defendants to ensure continued 

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compliance with any provision of this Consent Order and to hold Defendants in contempt for any 

violations of any provision of this Consent Order. 

89. To the extent that any funds accrue to the U.S. Treasury for satisfaction of 

Defendants' Restitution Obligation, such funds shall be transferred to the Department of Justice 

for disbursement to Defendants' clients. 

Civil Monetary Penalty 

90. Defendants shall pay, jointly and severally, a civil monetary penalty in the amount 

of One-Hundred and Fifty-Thousand Dollars ($150,000) ("CMP Obligation"). If the CMP 

Obligation is not paid immediately, then post-judgment interest shall accrue on the CMP 

Obligation beginning on the date of entry of this Consent Order and shall be determined by using 

the Treasury Bill rate prevailing on the date of entry of this Consent Order pursuant to 28 U.S.C. 

§ 1961. 

91. Defendants shall pay their CMP Obligation and any post-judgment interest, by 

electronic funds transfer, U.S. postal money order, certified check, bank cashier's check, or bank 

money order. If payment is to be made other than by electronic funds transfer, then the payment 

shall be made payable to the Commodity Futures Trading Commission and sent to the address 

below: 

CFTC 

C/O ESC/AMK-326; RM 265 

6500 S. MacArthur Blvd. 

Oklahoma City, OK 73169 

( 405) 954-6569 office 

( 405) 954-1620 fax 

9-AMC-AR-CFTC@faa.gov 

If payment by electronic funds transfer is chosen, Defendants shall contact Tonia King or her 

successor at the address above to receive payment instructions and shall fully comply with those 

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instructions. Defendants shall accompany payment of the CMP Obligation with a cover letter 

that identifies Defendants and the name and docket number of this proceeding. Defendants shall 

simultaneously transmit copies of the cover letter and the form of payment to the Chief Financial 

Officer, Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st Street, 

NW, Washington, D.C. 20581 and to Deputy Director, Robert T. Howell, Commodity Futures 

Trading Commission, Division of Enforcement, 525 W. Monroe St., Suite 1100, Chicago, IL 

60661. 

C. Provisions Related to Monetary Sanctions 

92. Partial Satisfaction: Acceptance by the Commission or the Monitor of any partial 

payment of Defendants' Restitution Obligation, or CMP Obligation shall not be deemed a waiver 

of their obligation to make further payments pursuant to this Consent Order, or a waiver of the 

Commission's right to seek to compel payment of any remaining balance. 

93. Asset Freeze: On November 30, 2018, the court entered an asset freeze order 

prohibiting the transfer, removal, dissipation and disposal of Defendants' assets ("Asset Freeze 

Order"), which was continued pursuant to the preliminary injunction order entered on December 

13, 2018. The court hereby lifts the Asset Freeze Order. 

D. Miscellaneous Provisions 

94. Notice: All notices required to be given by any provision in this Consent Order 

shall be sent certified mail, return receipt requested, as follows: 

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Notice to Commission: 

Robert T. Howell 

Deputy Director 

Commodity Futures Trading Commission 

Division of Enforcement 

525 W. Monroe Street 

Suite 1100 

Chicago, IL 60661 

Notice to Defendants: 

Dro Kholamian, individually and on behalf of Blue Star Trading, LLC 

21254 Crestview Dr. 

Barrington, IL 60010 

All such notices to the Commission shall reference the name and docket number of this action. 

95. Change of Address/Phone: Until such time as Defendants satisfy in full their 

Restitution Obligation and CMP Obligation as set forth in this Consent Order, Defendants shall 

provide written notice to the Commission by certified mail of any change to his telephone 

number and mailing address within ten calendar days of the change. 

96. Entire Agreement and Amendments: This Consent Order incorporates all of the 

terms and conditions of the settlement among the parties hereto to date. Nothing shall serve to 

amend or modify this Consent Order in any respect whatsoever, unless: (a) reduced to writing; 

(b) signed by all parties hereto; and (c) approved by order of this Court. 

97. Invalidation: If any provision of this Consent Order or if the application of any 

provision or circumstance is held invalid, then the remainder of this Consent Order and the 

application of the provision to any other person or circumstance shall not be affected by the 

holding. 

98. Waiver: The failure of any party to this Consent Order or of any client at any 

time to require performance of any provision of this Consent Order shall in no manner affect the 

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right of the party or client at a later time to enforce the same or any other provision of this 

Consent Order. No waiver in one or more instances of the breach of any provision contained in 

this Consent Order shall be deemed to be or construed as a further or continuing waiver of such 

breach or waiver of the breach of any other provision of this Consent Order. 

99. Waiver of Service, and Acknowledgement: Defendants waive service of this 

Consent Order and agree that entry of this Consent Order by the Court and filing with the Clerk 

of the Court will constitute notice to the Defendants of its terms and conditions. Defendants 

further agree to provide counsel for the Commission, within thirty days after this Consent Order 

is filed with the Clerk of Court, with an affidavit or declaration stating that Defendants have 

received and read a copy of this Consent Order. 

100. Continuing Jurisdiction of this Court: This Court shall retain jurisdiction of this 

action to ensure compliance with this Consent Order and for all other purposes related to this 

action, including any motion by Defendants to modify or for relief from the terms of this 

Consent Order. 

101. Injunctive and Equitable Relief Provisions: The injunctive and equitable relief 

provisions of this Consent Order shall be binding upon Defendants, upon any person under their 

authority or control, and upon any person who receives actual notice of this Consent Order, by 

personal service, e-mail, facsimile or otherwise insofar as he or she is acting in active concert or 

participation with Defendants. 

102. Authority: Dro Kholamian hereby warrants that he is the President and Managing 

Member of Blue Star Trading, LLC, and that this Consent Order has been duly authorized by 

Blue Star Trading, LLC and he has been duly empowered to sign and submit this Consent Order 

on behalf of Blue Star Trading, LLC. 

25 
21st March

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103. Counterparts and Facsimile Execution: This Consent Order may be executed in 

two or more counterparts, all of which shall be considered one and the same agreement and shall 

become effective when one or more counterparts have been signed by each of the parties hereto 

and delivered (by facsimile, e-mail, or otherwise) to the other party, it being understood that all 

parties need not sign the same counterpart. Any counterpart or other signature to this Consent 

Order that is delivered by any means shall be deemed for all purposes as constituting good and 

valid execution and delivery by such party of this Consent Order. 

104. Contempt: Defendants understand that the terms of the Consent Order are 

enforceable through contempt proceedings, and that, in any such proceedings they may not 

challenge the validity of this Consent Order. 

105. Agreements and Undertakings: Defendants shall comply with all of the 

undertakings and agreements set forth in this Consent Order. 

There being no just reason for delay, the Clerk of the Court is hereby ordered to enter this 

Consent Order for Permanent Injunction, Civil Monetary Penalty and Other Equitable Relief 

Against Defendants Dro Kholamian and Blue Star Trading, LLC, forthwith and without further 

notice. 

IT IS SO ORDERED on this __ day of _________ ~ 2022. 

Sara L. Ellis 

UNITED STATES DISTRICT JUDGE 

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CONSENTED TO AND APPROVED BY: 

Dro Kholamian 

President and Manager 

Blue Star Trallling, LLC 

21254 Crestview Dr. 

Barrington, IL 600 I 0 

Date:}-/ - "l-'lDro Kholamian, imllivitiually 

21254 Crestview Dr. 

Barrington, IL 600 I 0 

Date: / - 1 - 2. "2-

' p 

360 West Butterfield Road 

Suite 325 

Elmhurst, IL 60126 

Isl Susan B. Padove_ 

Susan B. Padove 

Senior Trial Attorney 

Commolllity Futures Trallling Commission 

52S W. Monroe Street 

Suite 1100 

Chicago, IL 60661 

3 l 2-596-0544 

Cell: 202-390-6885 

spadove@cftc.gov 

Attorneys for Defendants, Blue Star Trading, LLC and 

Dro Kholamian 

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UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

Commodity Futures Trading Commission, 

Plaintiff, 

Dro Kholamian; 

and 

v. 

Blue Star Trading, LLC 

Defendants. 

) 

) 

) 

) 

) 

) 

) Civil Action No: 1: 18-cv-7907 

) Judge Sara L. Ellis 

) Magistrate Judge Jeffrey Cole 

) 

) 

) 

) 

CONSENT ORDER FOR PERMANENT INJUNCTION, CIVIL MONETARY PENAL TY 

AND OTHER EQUITABLE RELIEF AGAINST DEFENDANTS DRO KHOLAMIAN 

and BLUE STAR TRADING, LLC 

Investor 

D.G., San Diego, CA 

G.G., Los Angeles, CA 

B.H., Encono, CA 

O.T., Evanston, IL 

S.G., Leesburg, VA 

R.F ., Highland Park, IL 

N .K., Morton Grove, IL 

ATTACHMENT A 

Amount Owed 

$25,000 

$20,000 

$35,000 

$50,000 

$17,000 

$60,000 

$20,000 

$227,000 
EXHIBIT A

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UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

UNITED STATES OF AMERICA 

No. 20 CR530 

V. 

JUNE 3, 2021 

Honorable Manish S. Shah 

United States District Judge 

Judge Manish S. Shah 

DRO KHOLAMIAN 

PLEA AGREEMENT 

1. This Plea Agreement between the United States Attorney for the Northern 

District of Illinois, JOHN R. LAUSCH, JR., and defendant DRO KHOLAMIAN, and his 

attorney, MATTHEW J. MADDEN, is made pursuant to Rule 11 of the Federal Rules of 

Criminal Procedure and is governed in part by Rule ll(c)(l)(A), as more fully set forth 

below. The parties to this Agreement have agreed upon the following: 

Charges in This Case 

2. The indictment in this case charges defendant with wire fraud, in violation 

of Title 18, United States Code, Section 1343 (Counts 1-9). 

3. Defendant has read the charges against him contained in the indictment, and 

those charges have been fully explained to him by his attorney. 

4. Defendant fully understands the nature and elements of the crimes with 

which he has been charged. 

Charge to Which Defendant Is Pleading Guilty 

5. By this Plea Agreement, defendant agrees to enter a voluntary plea of guilty 

to the following count of the indictment: Count One, which charges defendant with wire 

fraud, in violation of Title 18, United States Code, Section 1343. 
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Factual Basis 

6. Defendant will plead guilty because he is in fact guilty of the charge 

contained in Count One of the indictment. In pleading guilty, defendant admits the 

following facts and that those facts establish his guilt beyond a reasonable doubt: 

Beginning in or about January 2013, and continuing until in or about at least June 

2020, defendant Dro Kholamian devised, intended to devise, and participated in a scheme 

to defraud, and to obtain money and property based on materially false and fraudulent 

pretenses, representations, and promises, and by the concealment of material facts. 

The defendant was a self-employed trader, who traded commodity futures contracts. 

The defendant was the President and Manager of a company known as Blue Star Trading, 

LLC, located in Park Ridge, Illinois. The defendant solicited and obtained money from 

individuals who provided their funds to the defendant for him to manage as investments or 

as loans to him ( collectively referred to as "victims"). 

The defendant knowingly made materially false representations to victims in order 

to fraudulently obtain and retain the victims' funds. This included false representations 

concerning: (a) the risks involved in investing and lending those funds; (b) the expected 

and actual returns on those investments and loans; ( c) the ways those funds would be used 

and were used; and ( d) in certain cases, when those funds would be repaid. The defendant 

obtained funds from church members, close family friends, and others, including members 

of the Armenian community in the Chicago area, who trusted him to use and repay their 

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funds as promised. Instead of usmg victim funds as promised, the defendant 

misappropriated a substantial portion of those funds to pay for his own personal expenses, 

causing losses to the victims of at least approximately $750,000. 

The defendant obtained funds from victims by falsely representing that he was 

making substantial profits from trading at the time he obtained the funds and that he would 

earn money for victims and repay the loans he received, based on his highly profitable 

trading. The defendant failed to disclose to many of the victims that he was facing 

significant financial difficulties because he had very little income and his trading resulted 

in net losses, instead of profits. 

The defendant falsely represented to certain victims that he would trade their funds, 

in order to generate profits for them, when the defendant knew that he did not intend to 

trade all of their funds, and, in fact, did not trade all of their funds as promised. 

The defendant obtained money from victims by falsely representing to the victims 

that they would earn substantial profits or interest on their money. In fact, the defendant 

was losing money from his trading, and he was misappropriating victims' funds. 

The defendant falsely represented to certain victims that there was very little risk 

involved in providing money to him as an investment or loan. For instance, the defendant 

falsely represented to victims that he would repay their funds in a timely manner, which 

included repaying short-term loans promptly. He also falsely represented to certain victims 

that he would repay their principal, even if he lost all of their money trading, and falsely 

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represented to certain victims that they could withdraw their funds at any time. In fact, the 

defendant did not have - and was not earning - sufficient funds to repay the victims' money 

in a timely manner as promised. The defendant intentionally failed to disclose to victims 

the extent of the existing debt that he owed, and that he was unable to repay all of their 

money. 

The defendant borrowed funds from certain victims, falsely representing that he 

would use those funds to make improvements to a townhouse that he owned in Palatine, 

Illinois, in order to sell that property. In fact, the defendant did not use all of those funds 

to make improvements to that property as represented. He also promised to repay those 

victims from the proceeds of the sale of the townhouse, even though he knew that he would 

not be able to repay all of them with the proceeds from the sale of the Palatine townhouse. 

The defendant failed to disclose that he made the same promise to several victims, and the 

value of the townhouse was not sufficient to repay all of the victims. The defendant also 

falsely represented to certain victims that he would use their funds to prepare the 

townhouse for sale, which he did not do. Contrary to his representations, the defendant 

intended to, and did, use the victims' funds to pay personal expenses and other victims. 

The defendant falsely represented to certain victims that their funds were 

performing well and were earning money for them, in order to convince them that their 

funds were still safe and secure. 

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The defendant gave certain victims promissory notes, which made it appear that the 

victims were loaning money to the defendant, when, in fact, the victims provided that 

money to the defendant based on the defendant's promise to trade those funds. The 

promissory notes misrepresented the nature of the defendant's agreements with those 

victims. Rather than use funds in the manner he described to victims, the defendant 

misappropriated a substantial portion of victims' funds to pay for his own personal and 

business expenses, such as rent payments, car payments, health care payments, utility bills, 

restaurant charges, and retail purchases, and to make payments to certain victims. 

When the defendant was unable to repay certain victims, the defendant falsely 

represented to them that he had lost their funds through trading, concealing the fact that 

their funds were gone because he had used them for his personal use and to repay other 

investors. 

The defendant knowingly made false lulling statements to victims about paying 

them back, which included falsely promising that he would repay them soon and that they 

would get all of their money back. 

As a result of the scheme, the defendant caused losses to victims of at least 

approximately $750,000. 

On or about September 3, 2015, in the Northern District of Illinois, Eastern Division, 

and elsewhere, for the purpose of executing the scheme to defraud, the defendant 

knowingly caused to be transmitted in interstate commerce, by means of wire 

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communication, certain writings, signs, and signals, namely, an interstate wire transfer of 

$50,000, from victim Oscar.T.'s business account at the Northern Trust Company to the 

defendant's bank account at JP Morgan Chase in Chicago, Illinois, through the Fed Wire 

system, which funds were to be used for trading, in violation of Title 18, United States 

Code, Section 1343. 

Maximum Statutory Penalties 

7. Defendant understands that the charge to which he is pleading guilty carries 

the following statutory penalties: 

a. A maximum sentence of 20 years' imprisonment. This offense also 

carries a maximum fine of $250,000, or twice the gross gain or gross loss resulting from 

that offense, whichever is greater. Defendant further understands that the judge also may 

impose a term of supervised release of not more than three years. 

b. Defendant further understands that the Court must order restitution to 

the victims of the offense in an amount determined by the Court. 

c. Pursuant to Title 18, United States Code, Section 3013, defendant will 

be assessed $100 on the charge to which he has pled guilty, in addition to any other penalty 

or restitution imposed. 

Sentencing Guidelines Calculations 

8. Defendant understands that in determining a sentence, the Court is obligated 

to calculate the applicable Sentencing Guidelines range, and to consider that range, 

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possible departures under the Sentencing Guidelines, and other sentencing factors under 

18 U.S.C. § 3553(a), which include: (i) the nature and circumstances of the offense and the 

history and characteristics of the defendant; (ii) the need for the sentence imposed to reflect 

the seriousness of the offense, promote respect for the law, and provide just punishment 

for the offense, afford adequate deterrence to criminal conduct, protect the public from 

further crimes of the defendant, and provide the defendant with needed educational or 

vocational training, medical care, or other correctional treatment in the most effective 

manner; (iii) the kinds of sentences available; (iv) the need to avoid unwarranted sentence 

disparities among defendants with similar records who have been found guilty of similar 

conduct; and (v) the need to provide restitution to any victim of the offense. 

9. For purposes of calculating the Sentencing Guidelines, the parties agree on 

the following points, except as specified below: 

a. Applicable Guidelines. The Sentencing Guidelines to be considered 

in this case are those in effect at the time of sentencing. The following statements regarding 

the calculation of the Sentencing Guidelines are based on the Guidelines Manual currently 

in effect, namely the November 2018 Guidelines Manual. 

b. Offense Level Calculations. 

1. The base offense level 1s 7, pursuant to Guideline § 

2B 1.1 ( a )(1). 

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11. Pursuant to Guideline § 2B 1.1 (b )(1 )(H), the base offense level 

is increased by 14 levels because the actual loss to victims (approximately $750,000) was 

between $550,000 and $1,500,000. 

111. Pursuant to Guideline§ 2Bl.l(b)(2)(A)(ii), the offense level is 

increased by 2 levels because the offense involved 10 or more victims. 

1v. It is the government's position that pursuant to Guideline § 

2Bl.l(b)(20)(B)(iii), the base offense level is increased by 4 levels because the offense 

involved a violation of commodities law and, at the time of the offense, defendant was a 

commodity pool operator. The defendant is free to make his position known at sentencing. 

v1. Pursuant to Guideline § 2Bl.1, Application Note 16(C), the 

enhancement for abuse of a position of trust, under Guideline § 3Bl.3, should not be 

applied, if the enhancement for being a commodity pool operator is applied under § 

2Bl.l(b)(20)(B)(iii). The parties agree that if the court determines that the enhancement 

for being a commodity pool operator does not apply, then the base offense level should be 

increased by 2 levels, because defendant abused a position of trust in a manner that 

significantly facilitated the commission and concealment of the offense. 

vu. Defendant has clearly demonstrated a recognition and 

affirmative acceptance of personal responsibility for his criminal conduct. If the 

government does not receive additional evidence in conflict with this provision, and if 

defendant continues to accept responsibility for his actions within the meaning of Guideline 

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§ 3El.l(a), including by furnishing the United States Attorney's Office and the Probation 

Office with all requested financial information relevant to his ability to satisfy any fine or 

restitution that may be imposed in this case, a two-level reduction in the offense level is 

appropriate. 

1x. In accord with Guideline § 3El.l(b), defendant has timely 

notified the government of his intention to enter a plea of guilty, thereby permitting the 

government to avoid preparing for trial and permitting the Court to allocate its resources 

efficiently. Therefore, as provided by Guideline § 3El.l(b), if the Court determines the 

offense level to be 16 or greater prior to determining that defendant is entitled to a 2 level 

reduction for acceptance of responsibility, the government will move for an additional 1 

level reduction in the offense level. 

c. Criminal History Category. With regard to determining defendant's 

criminal history points and criminal history category, based on the facts now known to the 

government, defendant's criminal history points equal zero and defendant's criminal 

history category is I. 

d. Anticipated Advisory Sentencing Guidelines Range. Therefore, 

based on the facts now known to the government, the government anticipates that the 

offense level is 24, which, when combined with the anticipated criminal history category 

of I, results in an anticipated advisory sentencing guidelines range of 51 to 63 months' 

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imprisonment, in addition to any supervised release, fine, and restitution the Court may 

impose. 

e. Defendant and his attorney and the government acknowledge that the 

above guidelines calculations are preliminary in nature, and are non-binding predictions 

upon which neither party is entitled to rely. Defendant understands that further review of 

the facts or applicable legal principles may lead the government to conclude that different 

or additional guidelines provisions apply in this case. Defendant understands that the 

Probation Office will conduct its own investigation and that the Court ultimately 

determines the facts and law relevant to sentencing, and that the Court's determinations 

govern the final guideline calculation. Accordingly, the validity of this Agreement is not 

contingent upon the probation officer's or the Court's concurrence with the above 

calculations, and defendant shall not have a right to withdraw his plea on the basis of the 

Court's rejection of these calculations. 

10. Both parties expressly acknowledge that this Agreement is not governed by 

Fed. R. Crim. P. l l(c)(l)(B), and that errors in applying or interpreting any of the 

sentencing guidelines may be corrected by either party prior to sentencing. The parties may 

correct these errors either by stipulation or by a statement to the Probation Office or the 

Court, setting forth the disagreement regarding the applicable provisions of the guidelines. 

The validity of this Agreement will not be affected by such corrections, and defendant shall 

not have a right to withdraw his plea, nor the government the right to vacate this 

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Agreement, on the basis of such corrections. Both parties expressly acknowledge that this 

Agreement is not governed by Fed. R. Crim. P. 1 l(c)(l)(B), and that errors in applying or 

interpreting any of the sentencing guidelines may be corrected by either party prior to 

sentencing. The parties may correct these errors either by stipulation or by a statement to 

the Probation Office or the Court, setting forth the disagreement regarding the applicable 

provisions of the guidelines. The validity of this Agreement will not be affected by such 

corrections, and defendant shall not have a right to withdraw his plea, nor the government 

the right to vacate this Agreement, on the basis of such corrections. 

Agreements Relating to Sentencing 

11. Each party is free to recommend whatever sentence it deems appropriate. 

12. It is understood by the parties that the sentencing judge is neither a party to 

nor bound by this Agreement and may impose a sentence up to the maximum penalties as 

set forth above. Defendant further acknowledges that if the Court does not accept the 

sentencing recommendation of the parties, defendant will have no right to withdraw his 

guilty plea. 

13. Regarding restitution, defendant acknowledges that pursuant to Title 18, 

United States Code, Section 3663A, the Court must order defendant to make full restitution 

to victims in an amount to be determined by the Court at sentencing, which the parties 

anticipate will be approximately $750,000. The amount of restitution shall reflect credit 

for any funds repaid prior to sentencing. 

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14. Restitution shall be due immediately, and paid pursuant to a schedule to be 

set by the Court at sentencing. Defendant acknowledges that pursuant to Title 18, United 

States Code, Section 3664(k), he is required to notify the Court and the United States 

Attorney's Office of any material change in economic circumstances that might affect his 

ability to pay restitution. 

15. Defendant agrees to pay the special assessment of $100 at the time of 

sentencing with a cashier's check or money order payable to the Clerk of the U.S. District 

Court. 

16. Defendant agrees that the United States may enforce collection of any fine 

or restitution imposed in this case pursuant to Title 18, United States Code, Sections 3572, 

3613, and 3664(m), notwithstanding any payment schedule set by the Court. 

1 7. After sentence has been imposed on the count to which defendant pleads 

guilty as agreed herein, the government will move to dismiss the remaining counts of the 

indictment as to defendant. 

Acknowledgments and Waivers Regarding Plea of Guilty 

Nature of Agreement 

18. This Agreement is entirely voluntary and represents the entire agreement 

between the United States Attorney and defendant regarding defendant's criminal liability 

in case 20 CR 530. 

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19. This Agreement concerns criminal liability only. Except as expressly set 

forth in this Agreement, nothing herein shall constitute a limitation, waiver, or release by 

the United States or any of its agencies of any administrative or judicial civil claim, 

demand, or cause of action it may have against defendant or any other person or entity. The 

obligations of this Agreement are limited to the United States Attorney's Office for the 

Northern District of Illinois and cannot bind any other federal, state, or local prosecuting, 

administrative, or regulatory authorities, except as expressly set forth in this Agreement. 

Waiver of Rights 

20. Defendant understands that by pleading guilty he surrenders certain rights, 

including the following: 

a. Trial rights. Defendant has the right to persist in a plea of not guilty 

to the charges against him, and if he does, he would have the right to a public and speedy 

trial. 

1. The trial could be either a jury trial or a trial by the judge sitting 

without a jury. However, in order that the trial be conducted by the judge sitting without a 

jury, defendant, the government, and the judge all must agree that the trial be conducted by 

the judge without a jury. 

n. If the trial is a jury trial, the jury would be composed of twelve 

citizens from the district, selected at random. Defendant and his attorney would participate 

in choosing the jury by requesting that the Court remove prospective jurors for cause where 

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actual bias or other disqualification is shown, or by removing prospective jurors without 

cause by exercising peremptory challenges. 

111. If the trial is a jury trial, the jury would be instructed that 

defendant is presumed innocent, that the government has the burden of proving defendant 

guilty beyond a reasonable doubt, and that the jury could not convict him unless, after 

hearing all the evidence, it was persuaded of his guilt beyond a reasonable doubt and that 

it was to consider each count of the indictment separately. The jury would have to agree 

unanimously as to each count before it could return a verdict of guilty or not guilty as to 

that count. 

1v. If the trial is held by the judge without a jury, the judge would 

find the facts and determine, after hearing all the evidence, and considering each count 

separately, whether or not the judge was persuaded that the government had established 

defendant's guilt beyond a reasonable doubt. 

v. At a trial, whether by a jury or a judge, the government would 

be required to present its witnesses and other evidence against defendant. Defendant would 

be able to confront those government witnesses and his attorney would be able to crossexamine them. 

vi. At a trial, defendant could present witnesses and other 

evidence in his own behalf. If the witnesses for defendant would not appear voluntarily, he 

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could require their attendance through the subpoena power of the Court. A defendant is not 

required to present any evidence. 

vn. At a trial, defendant would have a privilege against selfincrimination so that he could decline to testify, and no inference of guilt could be drawn 

from his refusal to testify. If defendant desired to do so, he could testify in his own behalf. 

b. Appellate rights. Defendant further understands he is waiving all 

appellate issues that might have been available if he had exercised his right to trial, and 

may only appeal the validity of this plea of guilty and the sentence imposed. Defendant 

understands that any appeal must be filed within 14 calendar days of the entry of the 

judgment of conviction. 

21. Defendant understands that by pleading guilty he is waiving all the rights set 

forth in the prior paragraphs, with the exception of the appellate rights specifically 

preserved above. Defendant's attorney has explained those rights to him, and the 

consequences of his waiver of those rights. 

Presentence Investieation Report/Post-Sentence Supervision 

22. Defendant understands that the United States Attorney's Office m its 

submission to the Probation Office as part of the Pre-Sentence Report and at sentencing 

shall fully apprise the District Court and the Probation Office of the nature, scope, and 

extent of defendant's conduct regarding the charges against him, and related matters. The 

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government will make known all matters m aggravation and mitigation relevant to 

sentencing. 

23. Defendant agrees to truthfully and completely execute a Financial Statement 

(with supporting documentation) prior to sentencing, to be provided to and shared among 

the Court, the Probation Office, and the United States Attorney's Office regarding all 

details of his financial circumstances, including his recent income tax returns as specified 

by the probation officer. Defendant understands that providing false or incomplete 

information, or refusing to provide this information, may be used as a basis for denial of a 

reduction for acceptance of responsibility pursuant to Guideline § 3E 1.1 and enhancement 

of his sentence for obstruction of justice under Guideline§ 3Cl.1, and may be prosecuted 

as a violation of Title 18, United States Code, Section 1001 or as a contempt of the Court. 

24. For the purpose of monitoring defendant's compliance with his obligations 

to pay a fine and restitution during any term of supervised release or probation to which 

defendant is sentenced, defendant further consents to the disclosure by the IRS to the 

Probation Office and the United States Attorney's Office of defendant's individual income 

tax returns (together with extensions, correspondence, and other tax information) filed 

subsequent to defendant's sentencing, to and including the final year of any period of 

supervised release or probation to which defendant is sentenced. Defendant also agrees that 

a certified copy of this Agreement shall be sufficient evidence of defendant's request to the 

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IRS to disclose the returns and return information, as provided for in Title 26, United States 

Code, Section 6103(b). 

Other Terms 

25. Defendant agrees to cooperate with the United States Attorney's Office in 

collecting any unpaid fine and restitution for which defendant is liable, including providing 

financial statements and supporting records as requested by the United States Attorney's 

Office. 

26. Defendant understands that, if convicted, a defendant who is not a United 

States citizen may be removed from the United States, denied citizenship, and denied 

admission to the United States in the future. 

Conclusion 

27. Defendant understands that this Agreement will be filed with the Court, will 

become a matter of public record, and may be disclosed to any person. 

28. Defendant understands that his compliance with each part of this Agreement 

extends throughout the period of his sentence, and failure to abide by any term of the 

Agreement is a violation of the Agreement. Defendant further understands that in the event 

he violates this Agreement, the government, at its option, may move to vacate the 

Agreement, rendering it null and void, and thereafter prosecute defendant not subject to 

any of the limits set forth in this Agreement, or may move to resentence defendant or 

require defendant's specific performance of this Agreement. Defendant understands and 

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agrees that in the event that the Court permits defendant to withdraw from this Agreement, 

or defendant breaches any of its terms and the government elects to void the Agreement 

and prosecute defendant, any prosecutions that are not time-barred by the applicable statute 

of limitations on the date of the signing of this Agreement may be commenced against 

defendant in accordance with this paragraph, notwithstanding the expiration of the statute 

of limitations between the signing of this Agreement and the commencement of such 

prosecutions. 

29. Should the judge refuse to accept defendant's plea of guilty, this Agreement 

shall become null and void and neither party will be bound to it. 

30. Defendant and his attorney acknowledge that no threats, promises, or 

representations have been made, nor agreements reached, other than those set forth in this 

Agreement, to cause defendant to plead guilty. 

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31. Defendant acknowledges that he has read this Agreement and carefully 

reviewed each provision with his attorney. Defendant further acknowledges that he 

understands and voluntarily accepts each and every term and condition of this Agreement. 

AGREED THIS DA TE: ---------

Digitally signed by JASON 

JASON YONAN ~~:~021.05.21oa:52:53 

-05'00' 

Signed by Jason Yonan on behalf of 

JOHN R. LAUSCH, JR. 

United States Attorney 

JACQUELINE 

STERN 

Digitally signed by 

JACQUELINE STERN 

Date: 2021.05.2710:13:16 

-05'00' 

JACQUELINE STERN 

Assistant U.S. Attorney 

19 

DRO KHOLAMlAN 

Defendant 

MA~ 

Attorney for Defendant 
EXHIBIT B

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UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

FILED 

AUG 2 0 2020 -vV 

THOMAS G. BRUTON 

CLERK, U.S. DISTRICT COURT 

UNITED STATES OF AMERICA ) 

) 

) 

) 

) 

No. 20CR 530 

V. Violation: Title 18, United States Code, 

Section 1343 

DRO KHOLAMIAN JUDGE SHAH 

MAGISTRATE JUDGE COX 

The SPECIAL MAY 2019 GRAND JURY charges: 

1. At times material to this Indictment: 

a. Defendant DRO KHOLAMIAN was a self-employed trader, who 

traded commodity futures contracts and foreign exchange currency contracts. 

b. KHOLAMIAN was the President and Manager of a company known 

as Blue Star Trading, LLC, located in Park Ridge, Illinois. 

c. KHOLAMIAN solicited and obtained money from individuals who 

provided their funds to K.HOLAMIAN for him to manage as investments or as loans to 

him ( collectively referred to as "victims"). 

2. Beginning in or about no later than January 2013, and continuing until in or 

about at least June 2020, in the Northern District of Illinois, Eastern Division, and 

elsewhere, 

DRO KHOLAMIAN, 

defendant herein, devised, intended to devise, and participated in a scheme to defraud, and 

to obtain money and property based on materially false and fraudulent pretenses, 
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representations, and promises, and by the concealment of material facts, which scheme is 

further described below. 

3. It was part of the scheme that defendant KHOLAMIAN knowingly made 

materially false representations to victims in order to fraudulently obtain and retain the 

victims' funds. This included false representations concerning: (a) the risks involved in 

investing and lending those funds; (b) the expected and actual returns on those investments 

and loans; ( c) the ways those funds would be used and were used; and ( d) when those funds 

would be repaid. KHOLAMIAN targeted church members, close family friends, and 

others, who trusted him to use and repay their funds as promised. Instead of using victim 

funds as promised, KHOLAMIAN misappropriated a substantial portion of those funds to 

pay for his own personal expenses, causing losses to the victims of at least approximately 

$700,000. 

4. It was further part of the scheme that KHOLAMIAN obtained funds from 

victims by falsely representing that he was, at that time, a very succes~:ful trader, and that 

he would earn money for victims and repay the loans he received, based on his highly 

profitable trading. KHOLAMIAN failed to disclose to many of the victims that he was 

facing significant financial difficulties because he had very little income and his trading 

resulted in net losses, instead of profits. 

5. It was further part of the scheme that KHOLAMIAN falsely represented to 

certain victims that he would trade their funds, in order to generate profits for them, when 

KHOLAMIAN knew that he did not intend to trade all of their funds, and, in fact, did not 

trade all of their funds as promised. 

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