UK man Benjamin Reynolds was fined $ 571 million by the Commodities Futures Trading Commission (CFTC) for scamming US clients and receiving over 22.000 BTC in 2017.
On March 26, the CFTC wrote in an official statement that the Federal Court ordered Reynolds to pay a $ 429 million fine and $ 143 million in restitution in a March 2 ruling.
The man who lived in Manchester is accused of scamming (at the time 143 million dollars in bitcoin) US citizens and other countries. The promise was to trade BTC on their own on the market and increase their profits.
Reynolds used a public website, various social media accounts and email communications to solicit the loan of at least 22.190.542 of bitcoins worth approximately $ 143 million at the time, from over 1.000 customers worldwide. , including at least 169 individuals resident in the United States ".
The CFTC claims Reynolds is guilty
According to the CFTC, Reynolds created a company, Control-Finance, and lied to his clients. The company had employed several people to trade their bitcoins in virtual currency markets and generate significant profits for them.
"He also built an elaborate affiliate marketing network that relied on the fraudulent promise to pay outsized profits, rewards and bonuses to encourage customers to refer new customers to Control-Finance."
However, Reynolds did not trade any bitcoins or pay for any of the benefits, but ended up scamming nearly 170 of his customers residing in the United States. He perpetrated the crime for about six months between May 2017 and October 2018, after which he disappeared and has not yet been traced.
“Although Reynolds stated that he would return all bitcoin deposits to Control-Finance clients by the end of October, he never did and instead kept the deposits for personal use. Customers have lost most or all of their bitcoin deposits due to the fraudulent scheme ”.
Funds may never be recovered
The CFTC sued Reynolds in January 2019, but because he did not respond to the lawsuit, New York's Southern Borough said Reynolds was absent. As part of the final ruling, the Federal Court stated that Reynolds is blacklisted in CFTC markets ”.
The order also prevents Reynolds from engaging in conduct that violates the Commodity Exchange Act and CFTC regulations. You will not be able to register with the CFTC and trade on any market regulated by the CFTC ”.
If Reynolds has managed to keep all of its BTCs, its estimated value is around $ 1,2 billion at quotation of $ 54.800 per BTC. The Commission also concluded by notifying investors that not all restitution orders are executed, especially when the perpetrators remain hidden or do not have enough money to pay the fines.