Bitcoin Magazine

CFTC Charges Goliath Ventures With $400M Bitcoin Fraud

The Commodity Futures Trading Commission has sued a Florida crypto trading firm and its chief executive, alleging they ran a Ponzi scheme that took in at least $397 million from about 1,600 customers and spent it on fake payouts and personal luxuries.

The complaint, filed in the U.S. District Court for the Middle District of Florida, names Goliath Ventures Inc. and its CEO, Christopher Delgado, a Florida resident. 

According to the CFTC, Delgado and his company solicited money from the public for crypto asset trading, primarily in Bitcoin and other cryptos, then misappropriated all of it.

Rather than trading customer funds as promised, the agency alleges, the defendants used incoming money to pay fictitious profits to earlier investors and to bankroll what the complaint describes as Delgado’s lavish lifestyle. 

The CFTC also says the defendants guaranteed customers the return of their principal, their profits, or both, and sent out account statements showing gains that did not exist.

Delgado has already admitted criminal responsibility. In June, in a parallel case brought by the U.S. Attorney’s Office for the Middle District of Florida, he pleaded guilty to federal charges tied to the fraud. 

The Securities and Exchange Commission filed its own civil action against Delgado and Goliath on Tuesday, the same day as the CFTC complaint.

CFTC Chairman Michael S. Selig framed the case as part of a broader posture toward digital asset markets, saying the agency would keep policing fraud and manipulation while it develops clearer rules so legitimate firms can build domestically. David I. Miller, the agency’s director of enforcement, said the division remains what he called an important cop on the beat on digital commodity fraud.

The CFTC is seeking restitution for customers, disgorgement of ill-gotten gains, civil monetary penalties, trading and registration bans, and a permanent injunction barring further violations of the Commodity Exchange Act and the agency’s regulations.

The allegations in the civil complaint remain unproven. Counsel for Delgado and Goliath Ventures was not identified in the CFTC’s announcement.

Restitution orders in cases like this one are frequently difficult to collect. The agency routinely notes that wrongdoers may not have enough remaining assets to repay what victims lost.

This post CFTC Charges Goliath Ventures With $400M Bitcoin Fraud first appeared on Bitcoin Magazine and is written by Mathew Di Salvo.

Source: BitcoinMagazine