CFTC Indicts $44 Million Fraud by Oregon and Illinois Residents

The Commodity Futures Trading Commission (CFTC) announced on Thursday that it had filed civil enforcement actions against a Florida company and residents of Oregon and Illinois for soliciting at least $44 million in fraudulent investment in digital assets.

The CFTC has specifically named Jafia LLC, a Florida-based company owned by Sam Ikkurty a/k/a Sreenivas I Rao (OR), Ravishankar Avadhanam (IL) and Ikkurty.

In the complaint, the defendants are charged with operating an illegal product pool and not registering as a product pool operator. In addition, the complaint indicts a “Relief Defendant” who owns a fund without a legitimate interest in the three funds the Defendant owns and operates. Ikkurty Capital LLC d/b/a Rose City Income Fund, Rose City Income Fund II LP (Rose City) and Seneca Ventures LLC.

According to the CFTC, the plans date back to as early as January 2021. Defendants used YouTube videos and websites to “acquire more than $44 million to buy, hold and trade digital assets, commodities and derivatives.” from more than 170 participants. Swaps and Commodity Futures Contracts.

The complaint states that the defendants misused the funds by distributing them to other participants, similar to the Ponzi scam, instead of investing the co-participant funds as represented. The defendants are also believed to have transferred some of the funds for their own benefit to an offshore account under their control.

CFTC Announces Asset Freeze Order

The Commission has appointed a temporary fiduciary to secure the prior order to freeze assets under the defendant’s control and to preserve the records.

A hearing on the case is scheduled for May 25, 2022. The CFTC has announced several customer protection measures. Fraud Alerts and Articles It provides warning signs of fraud, including alerting the public to the possible risks associated with investing or speculation. virtual currency Or the recently launched Bitcoin Futures and Options.

The CFTC hopes to refund all those affected by this plan. It is also exploring other penalties, including fines and permanent bans.

US agencies are further scrutinizing enforcement.

With this lawsuit, the CFTC continues to demonstrate its position in protecting consumers and investors from malicious actors and, along with other federal agencies, has helped to better regulate the cryptocurrency space.

President Biden’s executive order has given US agencies more impetus to study the crypto industry to better protect US citizens. In fact, the SEC has already promised strict oversight of the crypto sector.

The Consumer Financial Protection Bureau (CFPB) presentation A Consumer Financial Protection Circular will be issued to help regulators enforce federal consumer laws. Due to the recent collapse of the cryptocurrency market, the interest of domestic lawmakers and regulators has also increased.

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