CFTC sued Cash FX and three individuals for $950 million crypto-related Ponzi scheme
On September 26, the U.S. Commodity Futures Trading Commission (CFTC) announced that it had filed a lawsuit against Cash FX Group and three individuals, accusing them of operating an investment scam involving more than $950 million and involving cryptocurrencies. The defendants include Cash FX and its CEO Huascar Jose Lopez Castillo (Brazil), The Conversion Pros and its CEO Ronald Pope (Oregon), and Justin Halladay (Florida). The complaint was filed with the Federal Court for the Central District of Florida on Friday. The CFTC accused the defendant of operating a multi-level marketing Ponzi scheme, raising and accepting more than $950 million in the name of trading retail foreign exchange contracts in commodity pools.
According to the CFTC, the defendant falsely claimed that the funds were managed by professional traders, proprietary algorithms and artificial intelligence, and promised a weekly return of up to 15%. But in fact, Cash FX conducted very few foreign exchange transactions and misappropriated most of the participants' funds to pay fictitious transaction profits with new participants' contributions, while transferring millions of dollars to each defendant. The defendant also provided the participants with false accounting statements, who lost at least $406 million.
On September 26, the U.S. Commodity Futures Trading Commission (CFTC) announced that it had filed a lawsuit against Cash FX Group and three individuals, accusing them of operating an investment scam involving more than $950 million and involving cryptocurrencies. The defendants include Cash FX and its CEO Huascar Jose Lopez Castillo (Brazil), The Conversion Pros and its CEO Ronald Pope (Oregon), and Justin Halladay (Florida). The complaint was filed with the Federal Court for the Central District of Florida on Friday. The CFTC accused the defendant of operating a multi-level marketing Ponzi scheme, raising and accepting more than $950 million in the name of trading retail foreign exchange contracts in commodity pools.
According to the CFTC, the defendant falsely claimed that the funds were managed by professional traders, proprietary algorithms and artificial intelligence, and promised a weekly return of up to 15%. But in fact, Cash FX conducted very few foreign exchange transactions and misappropriated most of the participants' funds to pay fictitious transaction profits with new participants' contributions, while transferring millions of dollars to each defendant. The defendant also provided the participants with false accounting statements, who lost at least $406 million.