SEC and CFTC Sue Goliath Ventures for $400M Crypto Ponzi Scheme
Vexoda Newsroom
Regulators have filed separate lawsuits against Goliath Ventures, its founder Christopher Delgado, over an alleged crypto Ponzi scheme that raised about $400 million from more than 1,300 investors.
The US Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) have jointly filed civil lawsuits against Goliath Ventures and its founder Christopher Delgado for an alleged crypto Ponzi scheme that raised approximately $400 million from over 1,300 investors.
According to the SEC, Goliath Ventures promised monthly returns of 3% to 10%, derived from fees paid by traders using their liquidity pools. However, the funds were instead used to pay earlier investors and fund personal expenses for Delgado, who is alleged to have diverted at least $51 million.
The CFTC further alleges that approximately 1,600 customers contributed a total of about $397 million after Goliath solicited funds for crypto trading in Bitcoin and Ether. The SEC seeks restitution, disgorgement, civil penalties, trading bans, and permanent injunctions to compensate investors.
Delgado has agreed to settle the SEC case under a bifurcated settlement subject to court approval. He will be permanently barred from violating securities-law provisions and participating in securities transactions outside personal-account activity. The court will determine the amount of disgorgement, prejudgment interest, and civil penalties.
This legal action adds securities and commodities-law consequences to an ongoing criminal case where Delgado has already pleaded guilty to conspiracy to commit wire fraud, wire fraud, and money laundering. He is also required to forfeit properties, vehicles, luxury goods, bank accounts, and crypto wallets traceable to the scheme.
The actions taken by SEC and CFTC highlight the growing regulatory scrutiny on cryptocurrency operations that engage in fraudulent activities. This case underscores the need for transparency and accountability within the industry.
Traders should be cautious of investment opportunities promising high returns with little or no risk, as they may be part of a Ponzi scheme. It is crucial to conduct thorough due diligence before investing.
Source: Cointelegraph. Summarized and rewritten by the Vexoda Newsroom. This is market news, not financial advice.