In line with an recent official announcement revealed a federal court of New York has ordered crypto hedge fund Gelfman Blueprint, Inc. [GBI] and its chief executive officer ‘Gelfman’ to pay over $2.5 Mln for in operation of an illicit Ponzi scheme. GBIis aNew York-based corporation and denominated Bitcoin [BTC] hedge fund launched back in year 2014. Asper the company’sweb site, by 2015 it had85customersand 2,367 Bitcoins [BTC]under its management.
The orderis thecontinuation of the initial anti-fraudsocial controlaction filed by the U.S.CommodityFuturesTradingCommission [CFTC] against GBI in earlier inSept2017. The CFTC charged GBI for allegedly running a Ponzischemefrom 2014 to 2016, telling investors that it had developed analgorithmreferred to as“Jigsaw”that allow substantial returns through a commodity fund. However in reality,this completeschemewas just a fraud.
In line with the announcement, GBI and Gelfman fraudulentlyraisedover $600,000 USD fromeighty customers. Moreover, Gelfmanpretended a fake“hack”to hidethe scheme’scommercialism losses which eventually resultedin thelossof virtuallyallinvestorsfunds.
The current order charges GBI and Gelfman to pay over $2.5 Mln in civilfinancialpenalties and restitution. GBI and Gelfmanareordered to pay $554,734.48 USD and $492,064.53 USD in restitution to customers and $1,854,000 USD and $177,501 USD in civilfinancialpenalties,considerably.
The CFTC’s Director ofEnforcement ‘James McDonald,’ aforementioned that “this case marksyet one morevictoryfor the Commissionwithin thevirtual currencyenforcementarena. As this string of cases shows, the CFTCis setto spotdangerousactors in the virtual currency markets and hold themaccountable.”
Even last month, the CFTC filed a suit with the U.S. District Court for the Northern District ofTXagainst2defendants for the allegedlyillicitsolicitation of Bitcoin [BTC]. In line with the suit, defendants Morgan Hunt and Kim Hecroft were runningtwoillicitbusinesses andmisleadingthe general publicto speculatein leveraged or margined foreign currency contracts,likeforex, binaryoptions, and diamonds.