Crypto enthusiasts and users understand the risks inherent in investing in digital assets. In addition to losing money in price crashes, investors are facing scams, pump-and-dump schemes, Hacking exchanges and protocols, Ponzi schemeSuch
Recently, many Latinx investors were hit with a cryptocurrency Ponzi scheme that led to the loss of funds. A city hall warning revealed that up to 30 residents have fallen victim to the scam and warned others to be careful.
Crypto Ponzi Scheme Claims Investor Funds
A Latin Times report shared that up to 30 victims of the operation alerted authorities to the losses caused by the fraudsters. I am an employee of the company involved, CryptoFX LLC.
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Defendants Mauricio Chavez and Giorgio Benvenuto offered unregistered crypto assets to Latinx investors in September 2022. SEC has implemented emergency measures stop providing.
In a press report, SEC officials revealed that Chavez claimed to be familiar with crypto trading and was supposedly teaching Latino residents how to make more money. NFTs were used to depict crypto assets that victims can trade to gain wealth.
However, when residents come to his seminars, he solicits them to invest in CryptoFX so that the company conducts digital asset and forex trading on their behalf.
However, the SEC clarified that he had no training, experience, or education regarding crypto assets or investments. He pitched himself as a senior-level trader, forcing investors to submit bogus documents and promising not to lose their money. Also, Chavez never got involved in cryptocurrency trading, instead paying investors with other people’s money based on a Ponzi scheme model.
He used 90% of his investor’s funds to pay other investors and developed properties under him and Benvenuto to finance a wealthy lifestyle.
Benvenuto, on the other hand, has drawn a number of investors into the scheme and used some of their funds personally, transferring them to the GBT Group, a company owned by him and Chavez.
According to the SEC, the two paid out $2.7 million to investors and used $8 million for personal purposes. He also revealed that Chavez alone has spent about $1.5 million on cars, jewelry, homes, credit card payments, adult entertainment for him, and more.
City Hall warns against scams offering victims solutions
The city hall warned last week about a Ponzi scheme for digital assets after many residents contacted authorities. made it clear that there is
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The city has therefore warned residents to exercise caution and thoroughly research any investment rather than investing in crypto-related offers. It also advised residents to contact authorities if a CryptoFX representative asked them to transfer funds.
I also got a warning site Victims can make claims for lost funds.another site To submit a claim, California Department of Financial Protection and Innovation Platform.
Featured image from Pexels and chart from Tradingview.com