CFTC Files $147 Million Enforcement Action Against Bitcoin Trading and Investment Company
Earlier this week, the Commodity Futures Trading Commission (“CFTC”) filed a civil enforcement action against Control-Finance, a United Kingdom-based Bitcoin trading and investment company. The complaint alleges that Control-Finance made numerous material misrepresentations and omissions, including that they (1) earned customers 1.5 % in daily Bitcoin trading profits and up to 45% per month; (2) used risk diversification methods to protect customers’ Bitcoin deposits; and (3) provided a “safe haven” from Bitcoin market risks. In reality, no trading occurred and they misappropriated up to $147 million in Bitcoin deposits.
The CFTDC also alleges that Control-Finance marketed their fraud through a pyramid scheme, called an “affiliate program.” The program touted promises of referral fees for individuals who brought in new Bitcoin depositors.
The CFTC seeks monetary penalties, restitution, rescission, disgorgement of ill-gotten gains, trading and registration bans, and permanent injunctions against further violations of the federal commodity laws.
To view the press release, visit: https://www.cftc.gov/PressRoom/PressReleases/7938-19?utm_source=govdelivery.
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