Eddy Alexandre, CEO of purported crypto trading platform EminiFX, has pleaded guilty to commodities fraud in a New York district court, agreeing to pay back millions to investors who lost funds to his “cryptocurrency investment scam.”
The United States Department of Justice (DOJ) announced on Feb. 10 that Alexandre submitted a guilty plea to one count of commodities fraud and will pay over $248 million in forfeiture along with restitution yet to be specified.
Alexandre was arrested and charged in May over his role in EminiFX and originally pleaded not guilty, but changed his plea on Feb. 10. He faces a maximum sentence of 10 years in prison.
According to U.S. Attorney for the Southern District of New York Damian Williams, from around September 2021 to May 2022, Alexandre ran the crypto and forex trading platform and “solicited more than $248 million in investments from tens of thousands of individual investors.”
Williams said Alexandre purported EminiFX could give “weekly returns of at least 5%” but in reality, the CEO didn’t invest a “substantial portion” of the funds and “even used some funds for personal purchases.”
He touted EminiFX as a platform for passive income that used a secret new technology to automate trading in crypto and foreign currencies that “guaranteed” the stated returns on investment.
Alexandre refused to state to investors what the technology was and promised they would double their money within five months. Investors in the scheme were falsely presented with information that they had earned the stated 5% returns.
Related: Crypto exchanges tackle insider trading after recent convictions
In reality, Alexandre lost millions of dollars on the funds he did invest — which he didn’t disclose to investors.
He also directed around $14.7 million to his personal bank account and used around $155,000 to buy a BMW and more on payments to a Mercedes Benz.
Some of the EminiFX investors were supportive of Alexandre despite the fraud he committed.
A handful traveled from abroad to attend an August plea hearing, according to an Aug. 10 Bloomberg report. One supporter claimed the case against Alexandre was racist.
He also faces a separate civil suit from the Commodity Futures Trading Commission, which is suing Alexandre for “fraudulent solicitation and misappropriation” relating to crypto and foreign exchange trading.
Source: https://cointelegraph.com/news/crypto-forex-platform-ceo-pleads-guilty-in-248m-fraud-scheme