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The United States SEC has filed charges against 17 individuals accused of orchestrating a cryptocurrency Ponzi scheme, which reportedly defrauded thousands of Latino investors in the country out of approximately $300 million.
The United States Securities and Exchange Commission has taken legal action against 17 individuals for their alleged involvement in perpetrating a cryptocurrency Ponzi scheme that resulted in the defrauding of thousands of Latino investors across the country, amounting to approximately $300 million.
Operational Details of CryptoFX LLC
The SEC's official release outlined that the accused individuals operated under the guise of a company named CryptoFX LLC, headquartered in Houston, Texas.
Mauricio Chavez and Giorgio Benvenuto, identified as the main operators of CryptoFX, were singled out in the SEC's complaint for their roles in orchestrating the Ponzi scheme.
Fraudulent Activities and Solicitation
The complaint filed by the SEC elaborated on CryptoFX's modus operandi, which purported to be a platform for trading cryptocurrencies and engaging in foreign exchange markets.
From May 2020 to October 2022, the 17 individuals, hailing from various states including Texas, California, Louisiana, Illinois, and Florida, allegedly targeted over 40,000 predominantly Latino investors in the U.S. Through enticing promises of returns ranging from 15% to 100%, they solicited investments from unsuspecting victims.
Misappropriation of Funds and Continued Solicitation
Despite claims of engaging in cryptocurrency and foreign exchange trading, the perpetrators reportedly diverted the funds amassed through the Ponzi scheme to support their lavish lifestyles. Rather than utilizing the investments as promised, they used the money to pay purported returns to other investors and to reward themselves with commissions and bonuses.
According to Crypto Potato, even after a court order mandated the cessation of CryptoFX operations in September 2022, Gabriel and Dulce Ochoa continued soliciting victim investments. Gabriel even advised investors to seek recourse from the SEC to recover their assets, while Maria Saravia dismissed investors' concerns by deeming the SEC's lawsuit false.
Based on a Crypto Times report, the SEC is pursuing permanent injunctions, disgorgement with interest, and civil penalties.
Serrano and Taffinder have agreed to final judgments, consenting to pay more than $68,000 in civil penalties, disgorgement, and interest. This legal action stems from the SEC's emergency halt of the CryptoFX scheme and the charges filed against its two primary principals in September 2022.
Legal Action and Seeking Redress
While some defendants have consented to final judgments without admitting or denying the allegations, the SEC is pursuing disgorgement with prejudgment interest and civil penalties against the remaining individuals implicated in the scheme.
Photo: Joshua Woods/Unsplash
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