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CFTC sues Colorado resident with fraud in crypto-related Ponzi scheme

Image by CFTC

Mon, 17 Feb 2020, 11:56 am UTC

The Commodity Futures Trading Commission (CFTC) sued a Colorado resident and his firm for duping U.S. investors of thousands of dollars.

In a press release, the CFTC announced that it has filed a civil enforcement action in the U.S. District Court for the District of Colorado against Breonna Clark and his firm Venture Capital Investments Ltd., charging them with fraud involving digital currencies.

Clark and his firm solicited U.S. residents to trade foreign exchange contracts as well as bitcoin and other digital assets through a commodity pool. The CFTC alleges that the defendants secured $534,829 from approximately 72 individuals and used at least $418,000 of the funds for personal expenses, which includes acquiring a BMW automobile and making Ponzi-type payments to other pool participants.

In addition to misappropriation of funds, the defendants also misled customers about their experience and financial credentials and sent them false account statements, which purported to show trading gains, the CFTC said. They have also been charged with failing to appropriately register with the CFTC pursuant to the Commodity Exchange Act and regulations.

“In its litigation against the defendants, the CFTC seeks restitution to defrauded customers, disgorgement of ill-gotten gains, civil monetary penalties, permanent registration and trading bans, and a permanent injunction against future violations of the Commodity Exchange Act, as charged,” the regulator noted.

Meanwhile, the CFTC's LabCFTC is going to host office hours during New York Fintech Week on April 1. Office Hours is intended to provide FinTech innovators and entrepreneurs an opportunity to engage with LabCFTC to discuss ideas, share a presentation and gain a better understanding of CFT’s framework.

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