Daily fraud update: 28th November

Chris Lee

CFTC reveals overall haul from fraud and crime

A major US regulator has announced just how much it has managed to haul in from criminals in the fraud space over the course of 2019.

The Commodity Futures Trading Commission (CFTC) is a regular name in the crypto and forex fraud headlines due to its pursuit of many alleged wrongdoers.

Now, it has announced just how much it has managed to bring in as a result of restitution and other levies.

Overall, its fiscal year – which began on 1st October 2018 and stretched until 30th September 2019.

In total, the regulator managed to bring in over $1.3bn from restitution and a range of other penalty varieties, including disgorgement.

On the whole, this represented a positive move for the agency – and it claims that the amount went up by almost 40% compared to the year before.

Overall, this is the fourth highest amount that the agency has collected in the history of its existence.

Moving away from financial figures, the regulator said that it had managed to bring almost 70 enforcement-type actions against suspected wrongdoers.

Its 69 such cases this year represented just two more than the 67 it bought the year before.

The figures also delved into the world of whistle blower awards, which are somewhat misunderstood in the crypto and forex fraud sphere.

While in 2018, it managed to distribute around $75m, this year it issued just $15m.

Tether and brands face further hit

Major cryptocurrency name Bitfinex and its associated stablecoin brand Tether have been told that they will face a further class action lawsuit in the US.

Bitfinex, which is an exchange platform, told its users that the move had been levied against it and Tether in the US District Court for the Western District of Washington.

Bitfinex stands accused of leading investors astray by “comingling” the brands of the two firms – while at the same time failing to declare how co-operative they were.

They are also accused of manipulating market demand, a claim made in a previous lawsuit filed last month in the District Court for the Southern District of New York.

In a strongly-worded rebuttal statement, Bitfinex and Tether described those working on the legal case against them as “mercenary”.

“As we predicted last month, mercenary lawyers continue to try to use Bitfinex and Tether to obtain a payday”, the statement read.

“To be clear, there will be no nuisance settlements or settlements of any kind reached. Instead, all claims raised across both actions will be vigorously contested and ultimately disposed of in due course. Once they are, Bitfinex and Tether will fully evaluate their legal options against those bringing and promoting the baseless claims.”

“These absurd and groundless accusations are an attack on the growth, success and innovation of the entire digital token ecosystem, in which Bitfinex is proud to play a critical role”, they added.


Chris Lee

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