Federal Court Grants Temporary Restraining Order Against Operators Of "Get-Rich-Quick" Scheme / The Mass Mail Fraud Scheme Targeted Seniors and Swindled Victims Nationwide (DOJ Release)
Federal Court Orders New Mexico Man to Pay Over $10.3 Million for Defrauding Commodity Futures Clients in Long-Running Ponzi Scheme (CFTC Release)
Federal Court Orders Nevada Company and its Owner to Pay More Than $32 Million for Cryptocurrency Fraud and Misappropriation Scheme (CFTC Release)
FINRA Gives Credit to Credit Suisse for Not Having A Relevant Disciplinary History (BrokeAndBroker.com Blog)
Kabra conducted business through a company called LaunchByte.io LLC and several affiliated entities. He held himself out to investors as a successful serial entrepreneur, venture capitalist and angel investor in start-up companies. Offering lucrative and low or no-risk returns on investments, Kabra lured investors with representations that their funds would be used to foster the growth and development of start-up companies, in order to prepare those companies for sale or for other legitimate business opportunities. In reality, Kabra used the money that he received from investors to pay off existing debts to prior investors in his scheme and to fund his lavish personal expenses, including using more than $200,000 of fraudulently obtained funds to purchase a power boat.As part of his plea agreement, Mr. Kabra admitted to victimizing more than 10 individuals who suffered more than $1.5 million in losses as a result of the scheme.
Between August 2008 and January 2021, AZIM, a long-time employee of a New York, New York-based bank ("Bank-1") stole approximately $1.7 million from her employer. Over the course of approximately 12 years, AZIM executed hundreds of wire transfers of Bank-1 funds to co-conspirators and related companies, who then sent portions of the ill-gotten funds to AZIM's personal bank account.In furtherance of her scheme to defraud Bank-1, AZIM repeatedly made false entries in Bank-1's systems, misappropriating funds paid to Bank-1 by its clients to satisfy outstanding loan obligations and then extending the maturity dates of those loan obligations, making it appear as though the loan obligations had not yet been paid. When even the fraudulently extended maturity dates came due, AZIM originated new, fraudulent loans. AZIM utilized the proceeds of those fraudulent loans to satisfy the loans for which she had previously stolen the client payments. In doing so, AZIM abused her position at Bank-1 and enriched herself at the expense of her employer.AZIM's fraud was discovered by Bank-1 when AZIM took a leave from her position at Bank-1 as a result of illness earlier this year. In January 2021, Bank-1 debited the account of a client of Bank-1 ("Client-1") in order to pay off an outstanding loan obligation Client-1 had coming due. Client-1 then alerted Bank-1 that the debit was improper, as Client-1 had, in fact, paid off that obligation in 2019. Upon further investigation, Bank-1 discovered that while the funds had been withdrawn from Client-1's account in or about 2019, AZIM had misappropriated those funds, using them for purposes other than satisfying Client-1's obligation.As a result of identifying this discrepancy, Bank-1 officials discovered approximately 14 loan obligations (the "Fraudulent Loan Obligations"), worth more than approximately $1 million, for which no underlying documents existed. AZIM appears to have entered each of the Fraudulent Loan Obligations in Bank-1's systems so that the proceeds could be used, in significant part, to pay off outstanding loan obligations coming to maturity; those loan obligations had, in fact, already been satisfied by clients, but AZIM had misappropriated the payments. In addition, Bank-1 officials discovered approximately five outstanding loan obligations, worth more than approximately $706,000, for which AZIM appears to have extended the maturity dates, despite the relevant clients having paid off the loan obligations.The approximately $1.7 million of loan proceeds resulting from the Fraudulent Loan Obligations and the improperly extended maturity dates appear to have been misappropriated by AZIM. Over the course of approximately 12 years, between 2008 and 2020, AZIM caused approximately 200 wire transfers of Bank-1's funds, each for an amount under $10,000, to be sent to third party accounts, including those of co-conspirators and related companies, which then returned portions of those funds to AZIM.
[T]he defendants allegedly made material misrepresentations and fraudulent statements through deceptive mass mailings in the form of chain letters and Internet advertisements, to induce victims to enroll in one or more of their fictitious "money-making" programs, including the "Cash and Gold Tycoon Program" and the "MAJOR BUX! HUGE BUZZ!! Money Making Program." The complaint states that the defendants induced the victims by promising exponential profits in the form of cash, commission payments, gold coins and silver bars, among other things. The complaint also states that many victims relied on the defendants' fraudulent misrepresentations and paid over $1,000 each to enroll in the fraudulent programs, only to receive nothing in return. According to the complaint, since February 2021, the defendants have sent thousands of unlawful mass mailings, and during the same time frame the United States Postal Inspection Service (USPIS) has collected over 30 mailings, including enrollment applications and payments, addressed to KC Promotions, from victims residing in 18 states, including in North Carolina.
[F]rom at least August 2000 until December 9, 2019, he solicited more than $14.2 million from 45 individuals to manage their trading in commodity futures, specifically U.S. Treasury Bond futures. However, Lien did not invest the client funds, but instead operated a classic Ponzi scheme, using the money to pay other clients. He also kept more than $3.5 million for so-called "management fees" he billed clients based on false trading profits. In addition, Lien gave his clients inaccurate account statements, including erroneous annual IRS Form 1099s that reported millions in fake profits. The order also states Lien failed to register as a futures commission merchant (FCM) to legally solicit and accept money from commodity futures clients for futures trades.
[F]rom December 2017 through the present, Saffron fraudulently solicited and accepted at least $15,815,967 worth of Bitcoin and U.S. dollars from at least 179 individuals to trade off-exchange binary options on foreign currencies (forex) and cryptocurrency pairs, among other things. During the early stages of his activity, Saffron created Circle Society and used this entity to perpetrate his fraud. According to the CFTC complaint and motion for default judgment, Saffron and Circle Society solicited members of the general public to participate in a commodity pool operated by Circle Society by making false claims of Saffron's trading expertise and guaranteeing rates of return up to 300%. Rather than using pool participants' funds to trade as promised, the defendants misappropriated funds, including by holding participants' funds in Saffron's personal electronic cryptocurrency wallet and by using funds to pay some participants with the funds of other participants, in the manner of a Ponzi scheme. The majority of participants, however, have been unable to obtain a return of any of their funds despite their repeated demands.