The SEC has accused 17 people of creating a $300 million cryptocurrency pyramid scheme

The U.S. Securities and Exchange Commission (SEC) has accused 17 people of creating the CryptoFX cryptocurrency pyramid, which raised over $300 million.

The SEC has accused 17 people of creating a $300 million cryptocurrency pyramid scheme

CryptoFX LLC was registered in the state of Texas and is mainly aimed at Latin American users. The organizers managed to attract over 40,000 customers from the United States and two other countries. The total damage from the actions of fraudsters, according to American law enforcement agencies, exceeded $ 300 million.

"We believe that CryptoFX was a Ponzi scheme targeting Latin American investors that raised $300 million. The organizers lured investors with promises of financial freedom and wealth that could change lives. To do this, clients were offered “risk-free” and “guaranteed” investments in cryptocurrencies. But, in the end, the only thing that CryptoFX guaranteed was the deception of thousands of victims from 10 US states and two other countries," said Gurbir Grewal, director of the SEC's law enforcement department.

CryptoFX promised investors a profit from investments in cryptocurrency trading in the amount of 15% to 100%. Most of the funds were used not for trading, but to pay interest to earlier investors and attract new ones. Of course, the organizers lived in a big way and bought a house in Texas for $1 million.

Interestingly, at the end of 2022, the SEC declared CryptoFX a pyramid scheme and ordered the suspension of the company's activities, accusing Mauricio Chavez and Giorgio Benvenuto of organizing the scheme. However, this did not prevent the other participants of the scheme ― Gabriel and Dulce Ochoa ― continue to raise funds.


Read More