Alleged $300,000,000 Crypto Ponzi Scheme in Texas Targeted by SEC As 17 Individuals Face Charges

US authorities have charged 17 people for their alleged involvement in a multi-million-dollar crypto Ponzi scheme.

In a new press release, the U.S. Securities and Exchange Commission (SEC) says it is charging 17 individuals with operating a crypto scheme that targeted 40,000 investors across three countries.

According to the regulatory agency, Texas-based firm CryptoFX allegedly mishandled $300 million worth of deposited customer funds under the leadership of the charged individuals who promised investors that the firm would generate gains of 15% to 100% from crypto and foreign exchange trading.

But instead of using the funds to trade, the SEC says the individuals used the money to give themselves bonuses, pay for the returns of other customers, hand out commissions to investors and fund lavish lifestyles.

Furthermore, the SEC’s complaint alleges that two of the defendants – Gabriel and Dulce Ochoa – continued to solicit investments even after they were ordered to stop in September 2022. The regulator says Gabriel instructed two victims to rescind their complaints to the SEC if they wanted to get their money back.

Says Gurbir S. Grewal, Director of the SEC’s Division of Enforcement,

“We allege that CryptoFX was a $300 million Ponzi scheme that targeted Latino investors with promises of financial freedom and life-altering wealth from ‘risk free’ and ‘guaranteed’ crypto and foreign exchange investments.

In the end, the only thing that CryptoFX guaranteed was a trail of thousands upon thousands of victims stretching across ten states and two foreign countries.

A scheme of that size requires lots of participants, and as today’s action demonstrates, we will pursue charges against not just the principal architects of these massive schemes, but all those who further their fraud by unlawfully soliciting victims.”

According to the press release, the SEC is seeking permanent injunctions, disgorgement with prejudgment interest and civil penalties against each defendant.

 

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