Contact

Click here for a confidential contact or call:

1-212-350-2774

Cryptocurrency

This archive displays posts tagged as relevant to cryptocurrency, including Bitcoin and others. You may also be interested in the following pages:

Page 1 of 6

July 2, 2021

Roger Nils-Jonas Karlsson of Sweden has been sentenced to 15 years in prison and ordered to forfeit more than $16 million, including several properties and a resort in Thailand, in one of the largest cryptocurrency Ponzi schemes ever prosecuted in the United States.  Starting in 2011 until his arrest in Thailand in 2019, Karlsson induced thousands of investors from around the country and over 45 countries around the world to use cryptocurrency to purchase shares in an entity he called Eastern Metal Securities, by falsely claiming that it was run by award-winning economists and had zero risk of loss.  He then misappropriated at least $1.5 million to fund a lavish lifestyle for himself.  USAO NDCA; DOJ; SEC

How will regulators respond to Bitcoin’s price fluctuations?

Posted  05/18/21
By Sarah “Poppy” Alexander
Bitcoins stacked with stocks rising
The price of Bitcoin—never stable—has become even more erratic in the last month.  From April 17 to May 17, the price fell 26%.  Such a huge drop would be noteworthy in a stock investment.  But in something claiming to be a currency, that kind of instability is normally only seen in times of crisis and hyperinflation.  Coming just as cryptocurrencies are making a play to be considered mainstream, this latest...

April 8, 2021

Circle Society, Corp. and its owner, David Gilbert Saffron, have been ordered to pay more than $32 million in restitution, disgorgement, and civil monetary penalty for cryptocurrency fraud and misappropriation.  First as an individual, and then through Circle Society, Saffron allegedly solicited millions in Bitcoin and U.S. dollars from at least 179 individuals by making false statements regarding his trading expertise and guaranteed rates of return.  However, rather than trading the fu­nds on foreign currencies and cryptocurrency pairs, Saffron directed­­ portions to his personal cryptocurrency wallet and used other portions to pay prior investors.  CFTC

CFTC Clobbers Cryptocurrency Con Man

Posted  04/1/21
By Leah Judge
cryptocurrency scam
Last week, the CFTC announced that a federal court entered a nearly $600 million default judgment against a British man who used bitcoin to defraud more than 1,000 people worldwide.  The judgment is yet another indication that the CFTC will vigorously police cryptocurrency fraud.

The Scam

The CFTC filed a complaint against Benjamin Reynolds and his bitcoin trading and investment company, Control-Finance, back in...

March 26, 2021

British citizen Benjamin Reynolds, who did business as Control-Finance Limited, has been ordered to pay a total of $571 million – $143 million in restitution and $429 million as a civil penalty – by default judgment in an enforcement action brought by the CFTC.  Reynolds solicited customers on the internet and by e-mail, falsely representing that Control-Finance would engage in virtual currency trades on their behalf, with a guaranteed profit.  Reynolds also created an affiliate marketing network, falsely claiming that he would pay referral bonuses to customers.  In fact, Reynolds made no trades on customers’ behalf, earned no trading profits for them, and paid no referral rewards or bonuses. Over the course of six months in 2017, Reynolds secured at least 22,191 bitcoin, worth $143 million at the time, from more than 1,000 customers worldwide, including at least 169 residing in the U.S.  CFTC

March 19, 2021

The CFTC has ordered digital asset exchange operator Coinbase Inc. to pay a civil monetary penalty of $6.5 million to settle charges of reporting false, misleading, or inaccurate information on the company’s GDAX electronic trading platform, which is published by various reporting firms and used by market participants to gauge the volume and liquidity of digital assets.  The CFTC also found Coinbase vicariously liable for a former employee who placed deceptive orders in Litecoin in order to artificially generate market interest.  CFTC

March 4, 2021

Sohrab Sharma, a co-founder of Centra Tech, which claimed to offer products including a debit card that would allow users to make retail purchases using cryptocurrency, has been sentenced to eight years in prison following his guilty plea to charges arising from Centra’s fraudulent representations to participants in its unregistered initial coin offering of “Centra Tokens” or “CTR tokens,” which raised more than $25 million from victims.  Sharma and his co-defendants falsely claimed that Centra Tech had an experienced executive team, agreements with card issuers, and licenses to operate in 38 states when, in fact, Centra Tech had none of these things.  USAO SDNY

February 23, 2021

Cryptocurrency trading platform Bitfinex, operated by iFinex, and Tether were ordered to end all trading activity for NY customers and agreed to pay $18.5 million in penalties following an investigation into their handling of customer deposits and withdrawals that resulted in the loss of hundreds of millions of customer assets.  Tether was found to have falsely represented that each of its stablecoins was backed one-to-one by U.S. dollars in reserve when, in fact, they were not.  NY

Top Ten SEC and CFTC Recoveries of 2020

Posted  01/15/21
top ten list
Despite its many shortcomings, 2020 did bring great news for whistleblowers: record-breaking growth in the CFTC and SEC Whistleblower Programs, as well as massive enforcement actions by both agencies.  In this post, we will detail the Top Ten SEC and CFTC recoveries of 2020 in cases other than FCPA enforcement.  As detailed below, the SEC netted billions of dollars in penalties and restitution from companies accused...

January 11, 2021

Steve Chen was sentenced to 10 years in prison following his guilty plea to charges arising from his promotion of a pyramid/Ponzi scam that netted $147 million from tens of thousands of investors.  Chen told victims that they could purchase interests in U.S. Fine Investment Arts, Inc. and other companies owned by him, falsely claiming that those companies mined and sold amber and other gemstones, and enlisted those investors to recruit others by awarding them bonuses and “Gem Coins” that he claimed were a digital currency.  USAO CD Cal
1 2 3 6

Newsletter

Subscribe to receive email updates from the Constantine Cannon blogs

Sign up for: