The CFTC cracks down on another multi-million crypto Ponzi scheme along with the South Korean regulators that aim to shut down the UK-based company Control Finance LTD and its founder Benjamin Reynolds as we are reading further in the latest crypto news.
The regulators allege that the illegal trading activities of the defendants resulted in defrauding the customers for thousands of Bitcoin which were worth millions of US dollars. In the U.S., the CFTC cracks down on the Ponzi scheme and according to the reports, the CFTC learned that the Ulsan District Prosecutors’ Office in South Korea is also investigating the defendants. The Bitcoin trading company Control Finance Limited and the founder Benjamin Reynolds have allegedly misappropriated about 22,858.822 Bitcoin or about 166 pounds from more than a thousand customers through the pyramid scheme:
‘’The Complaint charges the defendants with exploiting public enthusiasm for Bitcoin by fraudulently obtaining and misappropriating at least 22,858.822 Bitcoin—worth at least $147 million at the time—from more than 1,000 customers.’’
Control Finance created a complex pyramid scheme that enticed the customers and concealed their fraudulent scheme under the Control Finance ‘’Affiliate Program.’’ The defendants marketed and concealed their fraud through the pyramid scheme that they called the Affiliate Program and the program promised payments in Bitcoin including referral profits, bonuses, and rewards. As per the CFTC reports:
‘’The defendants used a website and accounts at popular social media sites to fraudulently solicit customers to purchase and transfer Bitcoin to them. The defendants induced customers into transferring Bitcoin to them by falsely representing that they employed expert virtual currency traders who earned guaranteed daily trading profits on all Bitcoin deposits”
The defendants also fabricated and posted false trade reports every week to make the customers believe that their deposits on the market were successful. In fact, the defendants made zero trades on the customers’ behalf and earned no profit for them. in 2017, the defendants shut down their website and suspended all of the payments to customers. Despite the efforts, the Korean and American regulators were unable to locate Benjamin Reynolds.
The Control Finance’s certificate of incorporation dated from 2016which also shows that the company director’s address was at 12 Richmond Street, Manchester, Greater Manchester England but it turned out that the address doesn’t exist.
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