Key takeaways:
- A federal court in Manhattan gave the founder and CEO of EminiFX a nine-year term for running a cryptocurrency Ponzi scheme.
- More than four months after he pleaded guilty to merchandise fraud, the decision was made.
Eddy Alexandre, the founder and CEO of EminiFX, was given a nine-year term by a federal court in Manhattan for running a cryptocurrency Ponzi scheme and making several hundred million dollars from numerous investors.
The trading platform EminiFX offers both forex and cryptocurrencies. Therefore, the site is run like a multi-level marketing program, encouraging long-time investors to bring in new members.
The decision was made more than four months after the cryptocurrency fraudster pleaded guilty to merchandise fraud on the basis that the site had defrauded over 25,000 investors of almost $249 million. US District Judge John Cronan in Manhattan said it was a significant deception among the Haitian-American community. Cronan stated:
“The fraud only ended because it was forced to end.”
On February 10, the US Department of Justice (DoJ) revealed that Alexandre had pleaded guilty to one count of commerce fraud and agreed to forfeit almost $249 million in ill-gotten gains.
Initially entering a not-guilty plea, Alexandre, who was detained and accused in May 2022 for his participation in EminiFX, amended his plea on February 10.
According to reports, Alexandre had previously told investors that they would double their money within five months in order to entice more than 25,000 investors into his fraud scheme by providing an alluring return of 5% each week. Damian Williams, a US attorney, said:
“Alexandre’s fraud was brazen and included fabricating weekly investment returns of at least 5% out of thin air and falsely claiming to use artificial intelligence trading technology that did not even exist.”
However, Alexandre only spends a small amount of the user’s money; the remainder is either spent on business-related costs, such as office space and solicitors, or on himself, such as placing millions of dollars in a personal bank account and spending on a new BMW. Alexandre could spend up to 30 years behind bars without a plea deal.
Eddy Alexandre invested some of the money given to him, according to a news statement from the US DoJ. However, the risky investments went bust, costing millions of dollars. In addition, he misappropriated over $14.7 million and spent more than $155,000 of consumer money on a BMW for himself. He also paid Mercedes Benz $13,000 as part of his extravagant spending.
