Benjamin Reynolds, the UK-based fraud behind the massive Bitcoin Ponzi scheme, is fined by CFTC a whopping $572 million penalty. The US Commodity Futures Trading Commission accuses Reynolds of running a pyramid scheme called Control-Finance. The scheme was promoted as a UK-based cryptocurrency investment company, which is a fraud according to CFTC. Control Finance Fraud Promises to Investors In a complaint filed in 2019, the agency reported that they obtained a fictional CEO, and misappropriated more than 22,800 bitcoin from more than 1,000 customers. The total worth of Bitcoin obtained is nearly $1.24 billion. In order to extract Bitcoin from investors, Control-Finance lured them with fake promises of guaranteed 1.5 percent a day, or 45 percent a month. Which will be described in weekly fabricated trade reports. The fraudulent scheme operated in 2017 between May and September. For new participants, they were assured to receive guaranteed annual returns, while they were actually duped into a Ponzi scheme. CFTC Cautioned Users According to CFTC, “While Reynolds represented that he would return all bitcoin deposits to customers of Control-Finance by late October 2017, he never did and instead retained the deposits for his own personal use. Customers lost most or all of their bitcoin deposits as a result of the scheme.” The court papers further allege that the fraud Ponzi-scheme creator copied the documents of the house of UK Companies. They aim to convince their victims that they were operating a regulated business through these papers. The watchdog said “Reynolds’ Control-Finance, in reality, did no trading and made no profits for customers. Instead, they laundered the stolen funds through thousands of circuitous blockchain transactions. In the course of his scheme, the defendant also transferred part of the stolen assets to bank accounts in offshore tax havens like the Seychelles islands.” As the scam’s director vanished, the CFTC cautions victims that restitution orders may not result in the recovery of any money lost because the wrongdoers may not have sufficient funds.
The post CFTC Fines Ponzi Scheme Fraud with $572 Million Penalty appeared first on Cryptoknowmics-Crypto News and Media Platform.
from Live Crypto News – Cryptoknowmics-Crypto News and Media Platform
