In a recent development, the Securities and Exchange Commission (SEC) has taken legal action against 17 individuals associated with CryptoFX LLC, a Texas-based company, for orchestrating a Ponzi scheme that defrauded over 40,000 investors, mainly from the Latino community, accumulating a staggering $300 million. The SEC’s intervention, announced today, follows an emergency intervention in September 2022, which initially halted the fraudulent operation and charged the key figures behind the scheme, Mauricio Chavez and Giorgio Benvenuto.

Operating from May 2020 to October 2022, the scheme enlisted individuals from Texas, California, Louisiana, Illinois, and Florida, who functioned as leaders of the CryptoFX network. They lured investors with promises of impressive returns ranging from 15 to 100 percent through cryptocurrency and forex trading. However, the SEC’s complaint reveals that the bulk of the funds weren’t utilized for trading but diverted to pay off earlier investors and for personal gains, including hefty commissions and bonuses for the perpetrators.

Notably, two defendants, Gabriel and Dulce Ochoa, continued soliciting investments even after court orders to cease the scheme, with Gabriel Ochoa advising investors to retract their SEC complaints to recoup their investments. Moreover, Maria Saravia allegedly misled investors by dismissing the SEC’s lawsuit as false allegations.

The SEC’s charges against the Ochoas, Saravia, and others encompass violations of antifraud, securities registration, and broker registration provisions of federal securities laws. Additionally, Gabriel Ochoa faces charges of breaching whistleblower protection provisions. The SEC is pursuing permanent injunctions, disgorgement with prejudgment interest, and civil penalties against each defendant.

In a significant development, two charged individuals, Luis Serrano and Julio Taffinder, have consented to final judgments, refraining from future violations of securities laws and agreeing to pay over $68,000 in combined penalties, disgorgement, and interest, without admitting or denying the allegations.

The SEC’s investigation, spearheaded by the Fort Worth Regional Office, remains ongoing as they pursue legal actions to ensure justice for the victims. This case underscores the hazards associated with unregistered investment offerings and underscores the importance of verifying the legitimacy of investment opportunities.

InvestingPro Insights: The SEC’s crackdown on the $300 million Crypto Ponzi Scheme targeting Latinos highlights the significance of due diligence in investment decisions. Stay informed and cautious to avoid falling prey to fraudulent schemes and protect your hard-earned money.

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