CFTC Charges Ohio Man for Running $12 Mn Bitcoin Ponzi Scheme

Key Takeaways

  • Giri and his company NBD Eidetic Capital, LLC and SR Private Equity allegedly solicited $12 million and 10 bitcoins from over 150 customers using fraudulent means.
  • Giri allegedly lured customers by promising guarantees of profits instead spent it on lavish goods.

The Commodity and Futures Trading Commission(CTFC) has filed a civil enforcement action against Rathnakishore Giri of Ohio, allegedly running a $12 million Bitcoin Ponzi scheme.

As per CFTC’s press statement, Giri and his Ohio-based companies NBD Eidetic Capital, LLC and SR Private Equity, LL solicited more than $12 million and at least 10 bitcoins from over 150 customers using fraudulent means.

Giri allegedly lured customers by promising that he would re-invest their cash and capital into investment funds to make them returns but instead spend it on lavish goods, the CFTC stated. CFTC adds that the defendants made several false and misleading statements in their solicitations to customers, including guarantees of profits and Giri’s supposed success as a digital asset trader. 

“The complaint also alleges in their solicitations to customers, the defendants omitted material facts, including the defendants misappropriated customer funds to pay profits to other customers in a manner akin to a Ponzi scheme and misappropriated customer funds to pay for Giri’s lavish lifestyle, which included yacht rentals, luxury vacations, and luxury shopping”, the press statement reads. 

According to CFTC Commissioner Kristin N. Johnson, Rathnakishore used the fervor of digital asset investment opportunities to his advantage and lured unwitting investors to contribute $12 million in cash/bitcoins to his funds by promising exceptional returns without any risk of financial loss.

 As per the complaint, the defendants allegedly commingled customer funds with Giri and the relief defendants’ funds when the defendants transferred customer funds to Giri and the relief defendants’ bank and digital asset trading accounts. 

The CTFC has further named Giri’s parents, Giri Subramani and Loka Pavani Giri, as relief defendants for possessing funds in which they have no legitimate interest. The CFTC said it is seeking restitution to the defrauded customers, civil monetary penalties, disgorgement of ill-gotten gains, permanent trading and registration bans, and a permanent injunction against further violations of the Commodity Exchange Act and CFTC regulations.

Recently, the CFTC has been increasingly cracking down on digital asset-related fraud and intends to bring more staff onboard to assist in these efforts. CFTC’s role in the digital asset market is more important than ever since the crypto world is slowly getting plagued with Ponzi schemes. Very Recently, a class action lawsuit was filed in the U.S. district court of the southern district of Florida against Billionaire Mark Cuban for allegedly promoting a massive crypto Ponzi scheme. 

Saniya Raahath
Saniya Raahath

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