The SEC Cracks Down on $300 Million Crypto Ponzi Scheme

The SEC Cracks Down on $300 Million Crypto Ponzi Scheme

The SEC Cracks Down on $300 Million Crypto Ponzi Scheme

The Securities and Exchange Commission (SEC) has taken legal action against 17 people involved in a fraudulent scheme linked to CryptoFX LLC, a company based in Houston, Texas. This scheme targeted over 40,000 investors, promising them big profits from investments in cryptocurrency and foreign exchange markets. However, instead of investing the money as promised, the scheme operated like a Ponzi scheme, using new investors’ money to pay fake returns to earlier investors and lining the pockets of those running the scheme. Even after the SEC stepped in to stop the fraud in 2022, some of the defendants continued to solicit investments and even tried to cover up their wrongdoing.

The SEC’s complaint, filed in court, accuses these individuals of breaking laws related to fraud, securities registration, and broker registration. The SEC is seeking legal orders to stop these individuals from continuing their activities, as well as to require them to return any ill-gotten gains and pay financial penalties. Two of the defendants have already agreed to settle the charges without admitting or denying guilt, and they will pay penalties and give back some of the money they made from the scheme.

The SEC’s investigation into this matter was led by its Fort Worth Regional Office and supervised by experienced staff. If you’re someone who invested in CryptoFX or have information about this scheme, you can contact the SEC staff via email or reach out to the court-appointed receiver for assistance. The SEC advises investors to be cautious and thoroughly research anyone offering investment opportunities, using the free search tool on Investor.gov to check backgrounds and learn more about investment risks. Additionally, investors can stay informed about potential risks associated with unregistered offerings by reading alerts issued by the SEC’s Office of Investor Education and Advocacy.

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