Key Points:
- Tennessee couple charged with defrauding over 100 investors in the “Blessings of God Thru Crypto” scheme by the CFTC.
- They raised $6 million, promising high returns through crypto futures trading.
- CFTC seeks restitution, but recovery difficult as funds were transferred to untraceable digital wallets.
The Commodity Futures Trading Commission (CFTC) filed a complaint on July 25 against Michael and Amanda Griffis, owners of a real estate company in Clarksville, Tennessee, for allegedly defrauding over 100 people in a digital assets commodity pool scheme. The couple raised more than $6 million by persuading colleagues and customers to pool funds for trading digital assets.
Operating under the name “Blessings of God Thru Crypto,” the defendants promised high returns to participants by claiming to trade “crypto futures” on the “Apex Trading Platform” with guidance from an individual named “Coach Wendy.” Their personal and professional connections were leveraged to lend credibility to the scheme.
A commodity pool is an investment vehicle that combines funds from multiple investors for trading in futures contracts or other commodity interests, typically managed by a pool operator.
The CFTC is seeking restitution, civil monetary penalties, permanent trading and registration bans, as well as a permanent injunction against further violations of the Commodity Exchange Act (CEA) and CFTC regulations.
“The defendants falsely represented that pool funds would be safe and under their control, that pool participants could expect high gains, and that the defendants would use pool funds to trade ‘crypto futures’ on the ‘Apex Trading Platform’ with the advice of a person identified only as ‘Coach Wendy,’” the CFTC stated.
The couple allegedly mingled the pool funds with their personal finances. Investors would transfer funds to Michael Griffis’ account, which were then moved to his personal account on Coinbase. Next, the funds were converted into digital asset commodities and transferred to the Apex Trading Platform for futures trading. However, the CFTC revealed that over $4 million of the pool funds were quickly transferred to digital wallets beyond the defendants’ control, making recovery impossible.
Approximately $855,000 was paid out to certain pool participants, resembling Ponzi-style payments. The CFTC warned that retrieving lost funds might prove difficult, as the defendants may lack sufficient assets. Despite this, the regulatory body is steadfast in holding the couple accountable for their actions. The defendants are accused of misappropriating around $1 million to settle debts and indulge in luxury purchases. The remaining funds were allegedly used for Ponzi-like payments to prolong the scheme.
Commodity pool scams have long been used to deceive victims, with perpetrators offering promises of unique market insights and fast returns. However, once the funds are in the pool operator’s control, recovering them becomes significantly challenging, especially when perpetrators transfer the funds to digital wallets outside their jurisdiction.
Ian McGinley, the CFTC’s director of enforcement, declared:
“The defendants betrayed their pool participants, and they profited from that betrayal. Today’s filing reinforces the CFTC’s long-standing commitment to hold accountable those who take advantage of victims.”
The CFTC insists that it will continue to hold the defendants responsible for their acts.
In a recent development, the CFTC issued a default judgment against Florida resident Adam Todd and his affiliated companies. The judgment comes from his involvement in illegal activities related to their digital asset exchange, operating under the name “Digitex Futures.”
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Source: https://coincu.com/205888-cftc-charges-tennessee-couple/