Bitcoin Investment Firm Will Pay Over $2.5 Million For Its Fraudulent Practices
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Answer Bitcoin Investment Firm Will Pay Over $2.5 Million For Its Fraudulent Practices
Investment firm Gelfman Blueprint, Inc. (GBI) of New York has paid more than $2.5 million in fines for its fraudulent practices, as decided by the Commodity Futures Trading Commission (CFTC). According to the agency, this is the first time that the CFTC has taken anti-fraud measures in relation to the bitcoin cryptocurrency.
Yesterday’s CFTC press release stated that GBI and its CEO Nicholas Gelfman engaged in fraudulent practices such as concealing trading losses by providing false performance reports to clients regarding bitcoin trading. These reports led clients to believe that profits were made on their behalf. Actual records showed few trades and customer losses – no profits.Read:Learn about the lending services between individuals in the world of bitcoin and digital currencies
The Commodity Futures Trading Commission (CFTC), which initially filed charges against the investment fraud last September, described the operation as a “commodity pooled fund that allegedly used a high-frequency algorithmic trading strategy, executed by the defendants’ computer trading program titled Jigsaw.” Scheme Ponzi in 2014
According to the report CCN Last year, Gelfman received more than $600,000 from 80 different investors over a two-year period.
James MacDonald, the FCC’s director of enforcement, said in a press release yesterday:
“This case represents another victory for the Commission in the digital currency enforcement arena. As this series of cases shows, the CFTC is determined to identify and hold notorious and fraudulent actors in the cryptocurrency markets to account. I am grateful to the members of the Digital Currency Law Enforcement Task Force for their tireless work on these matters.”
Although legal proceedings began last year, the sanctions were not over three days ago. The legal orders concluded that GBI’s customer earnings strategy “was fraudulent, performance reports were fraudulent, and, as in all (Ponzi) schemes, the supposed earnings payment to GBI customers in fact consisted of untapped funds from other customers”, According to a statement from the Commodity Futures AuthorityRead:The co-founder of Ripple is offering his XRP tokens for sale… What effect does this have on the price of the currency?
Nicholas Gelfman was also held responsible for the actions of the GBI’s Ponzi scheme. Yesterday’s press release revealed, “Gulfman wanted to hide business losses and misappropriations in the scheme, by faking a fake computer ‘hacking’ that was supposed to lose almost all of the clients’ money.”
The penalties include requiring GBI to pay more than $550,000 to clients, and charging Gulfman himself with an estimated $492,000 to pay to clients. Scammers will also pay fines of more than $1.8 million, in addition to a permanent ban on trading and registration.
Yesterday’s statement concluded with a statement that “the CFTC will continue to fight vigorously to protect customers and ensure wrongdoers are held accountable.”
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