US regulator sues five participants of the Icomtech crypto project

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Commodity Trading CommissionUS futures (CFTC) filed a lawsuit against five Americans who promoted what officials say was a fraudulent Icomtech cryptocurrency scheme that caused more than 170 people to lose money.

CFTC filed civil lawsuitCentral District of California v. David Carmona, Juan Arellano Parra, Moses Valdez, David Brend and Marco A. Ruiz Ochoa, charging them with Icomtech organization. The agency claims that the project's target audience was Spanish-speaking communities.

The project managed to attract several hundred thousanddollars from more than 170 users under promises to trade bitcoins and other crypto-assets. From August 2018 to December 2019, Icomtech representatives promised investors daily profits from 0.9% to 2.8% of the deposit amount. The organizers of Icomtech promised to double the amount available in customer accounts four to eight months after the start of trading. 

The defendants did not trade crypto assets,the regulator insists. Investors never received the declared profit, and representatives of the crypto pyramid simply embezzled client funds, spending them on personal needs.

CFTC requires defendants to return fundsreceived from investors, payment of administrative fines, and a permanent injunction against the organization of investment activities to prevent further violations of the Commodity Exchange Act (CEA) and CFTC regulations.

Last year, the regulator accused the foundercrypto derivatives platform Digitex in the absence of registration and illegal business activities. Recently, CFTC Commissioner Christy Goldsmith Romero warned that the agency will not become more crypto-friendly than the US Securities and Exchange Commission (SEC).