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CFTC Charges Cryptocurrency Investment Firm for Running an $11 Million Bitcoin Scam

CFTC Charges Cryptocurrency Investment Firm for Running an $11 Million Bitcoin Scam

Commodity Futures Trading Commission (CFTC) charged David Gilbert Saffron and his Circle Society Company for operating a Ponzi-style Bitcoin fraud that was worth $11 million. CFTC filed a complaint against Saffron and Circle Society on September 30, after which the court issued an order on October 3, to attach the assets of both the defendants.

Commodity Futures Trading Commission (CFTC) charged David Gilbert Saffron and his Circle Society Company for operating a Ponzi-style Bitcoin fraud that was worth $11 million.

CFTC filed a complaint against Saffron and Circle Society on September 30, after which the court issued an order on October 3, to attach the assets of both the defendants. The court also directed the concerned authorities that the records related to the case have to be well-preserved for future reference. This order was then extended on October 11, and now a hearing is scheduled for October 29.

CFTC, in its complaint, has sought to freeze the possessions to recover the $11 million that Saffron has purportedly conned out of his victims. As per the reports of the federal agency, Saffron duped investors by promising them a 300% return on their investment. The investors made investments in the Circle Society by way of bitcoins and fiat money. The funds were to be used for trading of exchange binary options on foreign currencies and cryptocurrency pairs. However, the funds were not used for investing. Instead, a part of the funds was used to run the Ponzi scheme by giving it to some of the investors, while the rest of the fund was transferred into the virtual currency wallet of Saffron.

CFTC is skeptical about whether there are enough funds left with the defendants for them to be able to pay back all of the funds taken from investors.

CFTC’s Chairman Heath P. Tarbert, said, that “Digital assets and other 21st century commodities hold great promise for our economy. Fraudulent schemes, like that alleged in this case, not only cheat innocent people out of their hard-earned money, but they threaten to undermine the responsible development of these new and innovative markets. America must be a leader in this space, and we will only succeed if these markets have integrity.”

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