Michael Shawn Stewart, a former trading firm executive, has been sentenced to 24 years in federal prison and ordered to pay over $93 million in restitution for his role in defrauding investors worldwide of $179 million through a sophisticated foreign currency exchange (ForEx) scheme. Stewart, 63, of Scottsdale, Arizona, was found guilty in May 2024 on 14 counts of wire fraud and one count of conspiracy to commit wire fraud.
Evidence presented at trial revealed that Stewart and co-defendant Bryant Edwin Sewall, 59, formerly of Little Elm, Texas, operated companies named Mediatrix Capital and Blue Isle Markets from various Caribbean islands. They provided false information about an algorithm-based ForEx trading program, falsely claiming Mediatrix had a successful trading history since 2013 with no losses, when it actually began in 2014 and incurred significant losses. Investors were promised "100% Transparency," "100% Liquidity," and "World Class Returns." Sewall was sentenced to 23 years in federal prison in November 2024 for the same offenses.
The scheme involved manipulating account statements to show only positive trades, intentionally hiding massive losses that substantially reduced investor accounts. By the end, investors were promised over $179 million but only $9.8 million remained, a discrepancy the defendants called "the hole." Stewart and Sewall rewarded themselves with approximately $28 million in performance fees and converted over $45 million in investor money into markup fees through Blue Isle, spending it on luxuries like real estate, boats, cars, and jewelry.
United States Attorney for the District of Colorado Peter McNeilly said, "Stewart and Sewall stole millions of dollars from unsuspecting clients so they could give themselves lives of luxury. Instead, they bought themselves decades in federal prison and have been ordered to pay $93 million to the people of whom they took advantage." FBI Denver Special Agent in Charge Amanda Koldjeski added that they "misled investors with calculated lies about profit potential while diverting the money for personal gain."
A third partner, Michael Young, previously pleaded guilty to making a false statement to the Securities and Exchange Commission and received a sentence of one year and one day in prison in 2024. The Federal Bureau of Investigation’s Denver Field Office conducted the investigation.