September 25, 2022

CFTC accuses hedge fund manager of $12M BTC fraud

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CFTC accuses hedge fund manager of $12M BTC fraud

The US Commodity Futures Trading Commission (CFTC) has filed a lawsuit against the owner of two investment companies as part of a plan to increase the transparency of hedge funds.

The CFTC filed a lawsuit in Ohio District Court against a localresident of Rathnakishore Giri, who organized a Ponzi scheme using bitcoins for $ 12 million. The regulator requires the termination of the two companies Giri SR Private Equity LLC and NBD Eidetic Capital LLC and force him to return the money to investors.

“Managing a private equity fund with a focus oncryptocurrencies, Geary invited investors to put more than $12 million in cash and bitcoin into their funds, promising exceptional returns without the risk of financial loss,” CFTC Commissioner Kristin N. Johnson said in a statement.

She clarified that Giri violated the law on exchangegoods, which prohibits the manipulation of information and the use of "fraudulent schemes". The CFTC commissioner added that Geary spent investors' money on living a luxurious lifestyle, "renting private jets and yachts, buying a vacation home, a luxury car and expensive clothes."

The supervisory authority demands from Giri not onlystop all fraud related activities, but also wants him to waive any monetary benefits "directly or indirectly" associated with the violation of the rules, including wages, commissions, credits, fees, income and any trading profits.

The lawsuit was filed the day afterThe CFTC, along with the US Securities and Exchange Commission (SEC), voted on a proposal that aims to expand the reporting requirements of large cryptocurrency hedge funds.