SEC Charges 17 in $300 Million Crypto Ponzi Scheme

SEC Exposes $300 Million Ponzi Scheme

The Securities and Exchange Commission (SEC) has unveiled charges against 17 individuals involved in a massive Ponzi scheme orchestrated by CryptoFX LLC. This Texas-based company allegedly defrauded over 40,000 investors, predominantly within the Latino community, amassing $300 million from May 2020 to October 2022.

Allegations of Fraud and Misuse

The SEC claims that the defendants promised investors returns of 15 to 100 percent through crypto asset and foreign exchange trading. However, most funds were reportedly used to pay earlier investors or for personal gain, including hefty commissions and bonuses for those involved.

Continued Deception

Despite court orders to cease the fraudulent activities, defendants Gabriel and Dulce Ochoa allegedly continued to solicit investments. Gabriel Ochoa further instructed investors to withdraw their SEC complaints to retrieve their funds. Another defendant, Maria Saravia, is accused of falsely portraying the SEC's lawsuit as fabricated.

Legal Actions and Consequences

The charges include violations of antifraud, securities registration, and broker registration provisions of federal securities laws. Gabriel Ochoa faces additional charges for breaching whistleblower protection provisions. The SEC seeks permanent injunctions, disgorgement with interest, and civil penalties against all defendants.

Initial Settlements and Ongoing Investigation

Luis Serrano and Julio Taffinder have consented to final judgments without admitting or denying allegations, agreeing to pay over $68,000 in penalties. The SEC's investigation, led by the Fort Worth Regional Office, continues to seek justice for the victims, emphasizing the risks of unregistered investment offerings.

This case underscores the critical need for investors to verify the legitimacy of investment opportunities to avoid falling prey to fraudulent schemes.