Cryptocurrency Fraud! US Regulator Sues - MnTrendsNews

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Sunday, 21 January 2018

Cryptocurrency Fraud! US Regulator Sues

The U.S Commodity Futures Trading Commission has charged 3 separate companies to court for fraudulent activities involving Crypto-currencies. They involve fraud and misappropriation of BTC and Litecoin.

The First Charge involved Colorado resident  Michael Dean and his company which was registered in UK; The Entrepreneurs Headquarters Ltd. They promised to convert into Fiat currency, Bitcoin and invest in a pooled investment Vehicle such as Binary options. and got $1.1 Million worth of Bitcoin from 600 memebers of the general public from April 2017. Dean claimed to have "strong skills in option trading" and was trusted for that.


The US Regulator however alleges that the Bitcoin received was misappropriated and not traded on Customer's behalf. He didn't stop there however and went on to launch another trading venture called Real Trade Profits.

The agency stated:
The CFTC Complaint charges the defendants with engaging in a fraudulent scheme to solicit bitcoin from members of the public, misrepresenting that customers’ funds would be pooled and invested in products including binary options, making Ponzi-style payments to commodity pool participants from other participants’ funds, [and] misappropriating pool participants’ funds.
The second case involves Patrick K. McDonnell and Cabbage Tech Corp.-his company doing business as Coin Drop Markets.

The CFTC is “charging them with fraud and misappropriation in connection with purchases and trading of bitcoin and litecoin.” Saying that McDonnell and his company had never been registered with the agency on any capacity, it said;The CFTC Complaint alleges that from approximately January 2017 to the present, Mcdonnell and CDM engaged in a deceptive and fraudulent virtual currency scheme to induce customers to send money and virtual currencies to CDM, purportedly in exchange for real-time virtual currency trading advice and for virtual currency purchasing and trading on behalf of the customers under Mcdonnell’s direction.

The Commission discovered that the supposedly expert, real-time virtual currency advice was never provided,” and that monies sent to McDonnell and his Company were never seen again.

See Also: Crackdown On CryptoCurrency Businesses Intensifies In Bali

The third case however has remained under seal and we await it's unsealing.

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