US Court Orders Hedge Fund Owner To Pay $84 Million
The post US Court Orders Hedge Fund Owner To Pay $84 Million appeared on BitcoinEthereumNews.com.
In the crypto world, a Chicago federal judge has ordered Sam Ikkurty, an Oregon resident, and his associated companies to pay over $120 million to victims defrauded in what the Commodity Futures Trading Commission (CFTC) has labeled a “classic Ponzi scheme.” The July 2nd ruling by Judge Mary Rowland marks a significant victory for the CFTC and sets a precedent for regulating lesser-known digital assets. Webinars, Promises, And Empty Accounts Ikkurty, through his companies like Rose City Income Fund and Seneca Ventures, allegedly lured investors with promises of a steady 15% annual return on investments in “stable” digital assets like Bitcoin and Ethereum. According to the CFTC, Ikkurty used webinars and trade shows to spread these claims, touting the supposed success of his previous funds to attract new participants. However, the court order paints a different picture. Judge Rowland found that Ikkurty’s marketing materials were misleading, overstating past performance and failing to disclose a near-99% value drop in his funds over a short period. The CFTC investigation further revealed that Ikkurty did not invest in “stable” digital assets as promised, but instead gambled on riskier ventures, even losing his personal Bitcoins to a hack. Total crypto market cap currently at $2.1 trillion. Chart: TradingView A Classic Case Of Duping People Perhaps the most egregious finding concerns Ikkurty’s alleged operation of a Ponzi scheme. The court order details how, instead of generating returns through investments, Ikkurty used funds from new investors to pay out promised returns to earlier participants. This practice, known as a Ponzi scheme, is inherently unsustainable and ultimately leads to the collapse of the scheme when new investors dry up. The order also details the misappropriation of funds through a carbon offset program. Investors were told their funds would be used to purchase carbon offset-related digital assets. However,…
Filed under: News - @ July 5, 2024 8:18 am