One of the executives behind a fraudulent foreign exchange trading scheme is facing 24 years in prison after being convicted by a federal jury in Colorado.
In 2024, Michael Shawn Stewart was convicted on 14 charges of wire fraud and one count of conspiracy to commit wire fraud, in connection with a forex trading scheme that misled investors about an algorithmic trading program.
According to court filings, between 2015 and 2019, Stewart, and his co-defendant, Bryant Edwin Sewall, operated offshore companies, Mediatrix Capital and Blue Isle Markets, that provided false information to investors about their trading performance — including making false claims that they had never recorded a losing month.
Investors were also misled with falsified account statements that showed only positive trades and hid their trading losses.
At the same time, Blue Isle charged investors US$45 million in markups, and Stewart and Sewall collected approximately US$28 million in performance fees, U.S. authorities alleged.
By the time the scheme collapsed, investors had been promised over US$179 million, but the companies only had US$9.8 million, they said.
Now, Stewart has been sentenced to 288 months in federal prison and ordered to pay US$93.3 million in restitution. Sewall was previously sentenced to 23 years in prison after being convicted on the same charges.
Back in 2019, the U.S. Securities and Exchange Commission (SEC) filed an emergency asset freeze against the firms and various insiders, including Stewart and Sewall.
That receivership remains ongoing, pending the outcome of the criminal case and a ruling on liability.
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