Online Trading Academy Lawsuit: FTC Settlement and Refunds

The Online Trading Academy lawsuit was a Federal Trade Commission enforcement action filed in February 2020 against the Irvine, California investment-training company, its founder Eyal Shachar, and two other executives, alleging that OTA used false earnings claims and fake testimonials to sell courses costing up to $50,000 and took in more than $370 million from consumers over six years. The case ended in a September 2020 settlement carrying a $362 million judgment (largely suspended based on the defendants’ claimed inability to pay), millions in cash and surrendered luxury assets, and more than $13.3 million in forgiven consumer debt. The FTC later mailed refund checks totaling more than $5.4 million to over 31,000 former customers.

What the FTC Accused OTA Of

The FTC filed its complaint on February 12, 2020, in the U.S. District Court for the Central District of California, naming OTA Franchise Corp., Newport Exchange Holdings, NEH Services, Inc., founder Eyal Shachar, chief trading strategist Samuel Seiden, and sales chief Darren Kimoto.¹ The Commission voted 5–0 to authorize the suit.

OTA pitched what it called a “patented strategy” that it claimed could produce significant income in any market. The FTC said the company’s own internal surveys and third-party trading data told a different story: the “vast majority” of customers actually lost money, and OTA never systematically tracked customer results at all.²

Instructors were commission-based salespeople, according to the complaint, but presented themselves to workshop attendees as successful traders who had built personal wealth using OTA’s methods. Kimoto allegedly told audiences he had once been a struggling trader $60,000 in the hole before OTA’s approach let him quit his job and earn a million dollars a year.³ The FTC said several prominent company representatives later admitted they had not made significant money trading.⁴

A separate charge involved how OTA handled unhappy customers. When people asked for refunds, the FTC said, the company required them to sign contracts barring negative posts on social media, blogs, and review sites, and even barring reports to law enforcement or the Better Business Bureau.² The agency called those gag clauses a violation of the federal Consumer Review Fairness Act.

What the Settlement Required

On September 15, 2020, the court entered a stipulated permanent injunction and monetary judgment, approved by a 4–0–1 Commission vote. The defendants were held jointly liable for $362 million. Most of that sum was suspended because they claimed they could not pay, but the full amount would come due immediately if they were later found to have misrepresented their finances.⁴

Each of the three individual defendants had to hand over cash and, in two cases, specific assets:

Thomas McNamara of Regulatory Resolutions, who had served as the court’s monitor over OTA’s marketing during the case, was named liquidator of the surrendered vehicles and aircraft and directed to send net sale proceeds to the FTC for consumer redress.⁵

Debt Forgiveness for Customers Who Financed Courses

Many customers still owed OTA money for training bought on credit. The settlement required OTA to notify those consumers and offer to cancel their debt. Consumers had 45 days to accept, and accepting meant giving up access to the courses they had bought. To push the company to cooperate, Shachar’s required cash payment was reduced by 70 cents for every dollar of debt consumers accepted as forgiven, capped at a $4 million reduction.⁴ In the end, OTA forgave more than $13.3 million in customer debt.⁶

Ongoing Restrictions on How OTA Can Operate

The permanent injunction placed lasting rules on the defendants going forward. Earnings claims are banned unless truthful and backed by written documentation available on request. The defendants cannot falsely claim instructors are active, successful traders, and cannot call commission-based salespeople “education counselors.” Contracts restricting consumer reviews or blocking customers from contacting law enforcement are prohibited. OTA had to notify past clients of their right to post honest reviews and host a dedicated web page about that right for at least three years. A compliance report was due one year after the order, and the defendants must report changes in business structure or personal contact information for ten years.⁵

Refund Checks to Former Customers

In August 2021, the FTC announced it was mailing refund checks to more than 31,000 people affected by OTA’s practices. The total payout was more than $5.4 million, with checks averaging about $175. Epiq administered the distribution, and checks were valid for 90 days from the date of issuance.⁶ Combined with the debt forgiveness, the FTC estimated the settlement would return more than $10 million in value to consumers.⁴

The Private Class Action

Two months after the FTC filed suit, customers brought their own case. In April 2020, plaintiffs Amy Jine and Ana Biocini filed a proposed class action in the same federal court, Case No. 8:20-cv-00769, against OTA Franchise Corp., Newport Exchange Holdings, NEH Services, Shachar, and Seiden. The complaint asserted eight causes of action, including fraud, intentional misrepresentation, concealment, breach of express warranty, unjust enrichment, and violations of three California consumer protection statutes.⁷

The plaintiffs cited consumer losses topping $370 million between January 2014 and May 2019 and alleged OTA specifically targeted elderly customers with promises of high profits, low risk, and minimal time commitment. The complaint quoted a November 2018 internal email in which Seiden, OTA’s own chief trading strategist, wrote to the company’s Vice President of Admissions that OTA was a “fraudulent business,” that he had “overwhelming proof of that fraud,” and that he received emails “every day” from students losing money.⁷

California’s Franchise Stop Order

State regulators followed. On July 27, 2021, the California Department of Financial Protection and Innovation issued a consent order against OTA Franchise Corporation. Because the federal permanent injunction covered company officers, the DFPI found that their continued involvement posed an “unreasonable risk to prospective franchisees” under California’s Franchise Investment Law. The agency issued a stop order barring OTA from offering or selling franchises in California for one year, with a potential three-to-five-year ban for violations.⁸

Is OTA Still in Business?

Yes. The settlement did not shut Online Trading Academy down. The company continues to market training and says it has served more than 85,000 students at over 30 education centers globally.⁹ Its post-settlement marketing frames student results as requiring “time, effort, and patience” and cautions that consumers “shouldn’t believe anyone who tells you otherwise” about shortcuts.¹⁰ Course pages now carry disclaimers such as “For educational purposes only. Trading is risky and you can lose money.”¹¹

Consumer complaints have continued to appear on the company’s Better Business Bureau profile for its Irvine location. A July 2025 complaint from a disabled consumer described being pressured into an $8,000 loan through a third-party financing company called CoveredCare and, after paying more than $4,200 in monthly installments, still owing over $6,500. A March 2026 complaint described a customer who said she was manipulated into signing a $35,000 contract after intending to enroll in a $22,000 program, following an instructor’s demonstration of rapid trading profits. In responses to complaints, OTA has cited a three-day right of rescission and contract terms stating no earnings are guaranteed. In an August 2025 response documented on the BBB page, an OTA representative acknowledged the FTC settlement, saying the company “settled with the FTC (without admission of guilt) to avoid years of costly litigation versus the US government.”¹²

If you received an FTC refund check in 2021, it was valid for only 90 days from issuance and cannot now be cashed. If you were an OTA customer but never got a check or debt-forgiveness notice, the FTC’s refund program is the source of any distribution tied to this case; the agency did not announce a later round.

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Federal Trade Commission. FTC Sues Online Trading Academy for Running Investment Training Scheme
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Federal Trade Commission. FTC Challenges Online Trading Academy’s Money-Making Claims
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Regulatory Resolutions. FTC Complaint Against OTA Franchise Corporation
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Federal Trade Commission. FTC Settlement Requires Online Trading Academy to Forgive Consumer Debt
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FTC. Stipulated Order for Permanent Injunction and Monetary Judgment, OTA Franchise Corporation
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FX News Group. FTC Sends Refunds to Over 31,000 Victims of Online Trading Academy
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CPM Legal. Jine et al. v. OTA Franchise Corp. et al., Class Action Complaint
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California DFPI. OTA Franchise Corporation Consent Order
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Trading Academy. Online Trading Academy Homepage
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Trading Academy. Online Trading Academy Press Release on CliK Features
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Trading Academy. Compass Program – Always Knowing Where True North Is
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Better Business Bureau. Trading Academy Irvine Complaints