The US Commodity Futures Trading Commission (CFTC) announced on Tuesday that it had filed a civil enforcement action to charge four operators for running a $44 million Bitcoin Ponzi scheme .
According to the press release, Dwayne Golden of Florida, Jatin Patel of India, Marquis Egerton of North Carolina and Gregory Aggesen of New York were charged with fraud for operating Ponzi schemes involving Bitcoin , for fraudulently soliciting more than $44 million of investments, and for misappropriating millions of dollars.
Golden, Patel and Egerton are accused of fraudulently soliciting more than $23 million worth of Bitcoins through the websites Empowercoin and Ecoinplus. Also, alleged in the complaint is that Golden, Patel, Aggesen and an associate operated JetCoin through which they defrauded individuals of more than $21 million in Bitcoins.
The complaint says that the websites all promised customers that professionals would trade their Bitcoins for daily profits.
Customers’ Bitcoins were either misappropriated by defendants and their accomplice or they were used to make fictitious profit payments to other customers that were Ponzi schemes, according to the complaint.
Civil Monetary Penalties Sought
Golden, Patel and Egerton are alleged to have misappropriated $9.8 million in Bitcoin. In addition, the operators and an accomplice are accused of misappropriating approximately $7.8 million worth of Bitcoin received from the JetCoin website.
“This case illustrates how fraudsters never tire of devising schemes to separate people from their hard-earned money and digital asset frauds are no exception,” Vincent McGonaglem, the Acting Director of Enforcement, commented. Accordingly, restitution, disgorgement, civil monetary penalties, permanent trading and registration bans are requested, as well as a permanent injunction against further violations of the Commodity Exchange Act (CEA) and CFTC regulations, as charged.
Last month, the CFTC charged The W Trade Group LLC, Larry Ramos Mendoza and Joseph Carvajales, both from Miami, Florida, with fraud and misappropriation of more than $19 million involving futures, forex and options.
