The U.S. Securities and Exchange Commission (SEC) has announced charges against 17 individuals implicated in a massive $300 million Ponzi scheme orchestrated through CryptoFX LLC. This scheme primarily preyed upon over 40,000 investors, predominantly from the Latino community. This announcement follows a critical emergency action by the SEC in September 2022, which effectively dismantled the CryptoFX operation and brought charges against its leading figures, Mauricio Chavez and Giorgio Benvenuto.
CryptoFX lured investors with the false promise of financial liberation and substantial wealth through purportedly “risk-free” and “guaranteed” investments in cryptocurrency and foreign exchange markets. However, the reality was a stark contrast, leaving a vast number of victims in its wake across ten states and two countries.
According to the SEC’s complaint, CryptoFX falsely claimed to engage in cryptocurrency and foreign exchange trading on behalf of investors. Instead, from May 2020 to October 2022, the charged individuals, hailing from states including Texas, California, Louisiana, Illinois, and Florida, falsely promised astronomical returns ranging from 15 to 100 percent. In reality, the substantial sum of $300 million raised from investors was misappropriated to pay fictitious returns to earlier investors, commissions, and fund the lavish lifestyles of the defendants.
Furthermore, the complaint reveals that even after a court order halted CryptoFX’s operations, certain defendants, notably Gabriel Ochoa and Dulce Ochoa, continued to solicit investments deceitfully. Gabriel Ochoa went as far as instructing investors to withdraw their complaints to the SEC to supposedly reclaim their investments. At the same time, another defendant, Maria Saravia, falsely claimed the SEC’s lawsuit was not genuine.
The SEC’s complaint seeks permanent injunctions, disgorgement with prejudgment interest, and civil penalties against each defendant for violating federal securities laws.
In a move toward accountability, two defendants, without admitting or denying the SEC’s allegations, consented to final judgments that include injunctions against further violations of securities laws and agreed to pay combined penalties and disgorgement exceeding $68,000.
