Once again, a fraudulent BTC Ponzi Scheme has come to light, which fortuntely has been dealt with strictly in the NBA Texas Federal Court. The court has found two defendants guilty of engaging in a fraudulent BTC scheme, and has ordered them to pay $400,000.
The two defendants, Morgan Hunt and Kim Hecroft operated a fraud BTC scheme and solicited Bitcoin (BTC) from members of the public, to invest in trading products like foreign currency, diamonds and many more such items. The news was made public by the United States Commodity Futures Trading Commission (CFTC).
The case was ongoing in the U.S. District Court for the Northern District of Texas and was being presided by Judge Reed C. O’Connor. He filed an Order and Default Judgment on June 28. The court has found out that the defendants conducted their business through entities called Diamonds Trading Investment House and First Options Trading.
The order that has been filed by the judge reads that the defendants
“falsely claimed that they would use customer funds to invest in trading for the benefit of the customers, misrepresented their experience and track record as traders and portfolio managers, falsely told customers that they could not withdraw their purported investment profits without first paying a tax to the CFTC, and misappropriated customer funds.”
With the popularity of BTC soaring high, more such ponzi schemes are coming to light, which is quite alarming for the market as a whole. Instances such as this make the general public skeptical towards the legitimacy and reputation of BTC.
The court has ordered Hunt and Hecroft to pay restitution and a $180,000 civil monetary penalty each. Additionally, a permanent trading and registration ban has been imposed on both of them. However, it looks like the two might not have sufficient funds to repay the victims.