Sunday, November 27, 2022

CFTC Charged 2 Men With Running A Crypto Ponzi Scheme

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The CFTC charged 2 men with running a crypto Ponzi scheme that netted them $44 million by using YouTube videos to dupe clients that invested in different crypto funds so let’s read more today in our latest cryptocurrency news.

Sam Ikkurty and Ravishankar Avadhanam are the 2 men charged with running a Ponzi scheme by the CFTC and both are US residents who managed to defraud hundreds of investors out of $44 million. The officials with the Commodity Futures Trading Commission alleged that Sam Kkurty from Portland and Ravishankar Avadhanam of Aurora, alongside multiple corporate entities collared by the defendants, worked together to convince their victims to invest in the income fund scheme with the the the investmetns in digital assets. The defendants were charged with operating an illegal commodity pool and failing to register as a pool operator with the CFTC.

The CFTC charged 2 men after they told investors that they will use their funds via two of their entities Rose City Income Fund and Seneca Ventures, to invest in different cryptocurrencies that promise high returns of up to 62% annually. According to the complaint, the pair advertised via a website and other videos posted on Youtube. The CFTC said that the two men pooled the investor funds and distributed most of the funds as profits to other participants similar to a Ponzi scheme. Additionally, the CFTC also said the two men kept $18 million for themselves and transferred the funds to other participants as well as off-shore entities under their control.

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More than 1,200 people were lured into the Ponzi scheme by the three high-profile individuals.

The federal count in Illinois issued a restraining order which froze their assets and preserved documents relating to the scheme, appointing a receiver for the investor funds. The CFTC is also seeking restitution, civil monetary penalties, disgorgement, and a permanent trading ban.

As recently reported, The CFTC will add more resources to battle manipulation and fraud in the crypto markets as the chairman Rostin Behnam noted. Behnam argued that the recent global conflicts outlined the ability of digital assets to be a tool for all those that present a risk to the broader American economy, the public, and the way of life. The CFTC chairman’s remarks came in the wake of the Terra collapse which made shockwaves on the entire market. The data shows that about $350 billion of the crypto total market cap was wiped out in the past ten days and the losses included ETH, BTC, and other cryptocurrencies beyond just Terra’s LUNA and its UST stablecoin.

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