The CFTC Asks Court to Issue Fines in Excess of $100M Against Mastermind of a Fraudulent Crypto Scheme

0
113

The Commodity Futures Trading Commission (CFTC) has filed a motion in New York’s Southern District Court seeking severe penalties against Michael Ackerman, the mastermind behind a fraudulent cryptocurrency scheme. According to the motion, the US agency wants the court to order Ackerman to pay $ 27 million in restitution plus a civil penalty of $ 81 million.

Additionally, the CFTC would like a default judgment against Ackerman after he failed to show up for the first hearing. The first filing that the agency filed with the US Securities and Exchange Commission followed allegations that Ackerman disappeared after raising funds from investors.

Ackerman, a former stockbroker, has allegedly raised around $ 33 million from over 150 investors, according to a report summarizing the case. Ackerman successfully convinced investors that he would put a significant portion of their funds in the crypto market. The report adds that Ackerman also claimed he was using a “special algorithm that maximizes return on investment”.

However, in its most recent motion, the CFTC said Ackerman had failed to keep those promises. The new application is:

In truth, Ackerman invested no more than $ 10 million out of the $ 33 million raised by cryptocurrency investors, and the gains made by the algorithm were minimal at best.

Rather than investing the funds as promised, Ackerman reportedly used the funds to “buy and renovate a new home, pay more than $ 600,000 for personal security services, add more than $ 100,000 worth of jewelry to Tiffany & Co. buy and buy three cars. “

To make his fraudulent venture appear legitimate, Ackerman allegedly used two companies, Q3 Trading Club and Q3 I, LP. The CFTC’s new motion also shows that Ackerman had also resorted to “rigged screenshots of balances” and falsified information to hide the fraud.

What do you think of the CFTC’s recent motion against Ackerman? You can share your views in the comments section below.

Photo credit: Shutterstock, Pixabay, Wiki Commons

Disclaimer of liability: This article is for informational purposes only. It is not a direct offer or an invitation to make an offer to buy or sell, or a recommendation or approval of products, services or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author are directly or indirectly responsible for any damage or loss caused or allegedly caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.