In a press release, the Commodity Futures Trading Commission (CFTC) revealed that a federal court in New York has ordered Rashawn Russell to pay more than $1.5 million in restitution after he was found guilty of orchestrating a fraudulent digital asset trading scheme.
The ruling, issued by the U.S. District Court for the Eastern District of New York, permanently prohibits Russell from participating in any Commodity Futures Trading Commission (CFTC)-regulated markets for third parties and bans him from self-trading for 8 years.
Russell, a New York resident, was charged with “fraudulent solicitation and misappropriation of investor assets” under the Commodity Exchange Act and CFTC regulations.
CFTC Breaks Down Fraudulent Trading Scheme
According to the CFTC, between November 2020 and August 2022, Russell lured more than two dozen investors into contributing Bitcoin, Ether, and fiat currency to his so-called proprietary digital asset trading fund.
The press release states, “The order further finds Russell intentionally and/or recklessly made false and misleading statements regarding the fund’s structure, size, and performance to obtain and retain investors; failed to trade the money and assets as represented; and, falsely promised to pay withdrawal requests.”
However, instead of trading as he promised, Russell used the funds for personal expenses, gambling-related transactions, and Ponzi-like payments to current customers.
Russell also faced criminal prosecution for his fraudulent activities. On September 19, 2023, he pleaded guilty to one count of wire fraud tied to his crypto scheme and another count of access device fraud from an unrelated case.
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Source: https://www.cryptonewsz.com/cftc-1-5-m-crypto-fraud-bans-from-self-trading/