United States regulator, The Commodity Futures Trading Commission (CFTC) has charged one Utah man, Jacob Orvidas, for fraudulent activities.
Consequently, he is required to pay more than $2 million in restitution and a $500,000 civil monetary penalty. Orvidas is expected to cease and desist from violating the Commodity Exchange Act any further.
In addition to these settlement charges, the 28-year-old Utah man has been levied with a 10-year registration and trading ban. According to CFTC’s Director of Enforcement Ian McGinley, it is the core of the agency’s digital-asset enforcement program to protect ordinary people.
Orvidas Deceives Four Pool Investors
Orvidas’ dubious activities took place for almost two years; from approximately October 2017 through at least July 2020. He solicited about four pool participants to trade leveraged Bitcoin (BTC) on their behalf in a commodity pool. He deceived them with empty promises of outrageous profit.
The CFTC filing highlighted that “Orvidas told one pool participant that another client contributed $100,000 worth of bitcoin and cashed out at $2.7 million, and that “[c]rypto trading is a joke . . . [i]t’s like printing money . . . .,” and none of this was true.
Utah Man Dupes Pool Investors of Over $2M
Pumped by all these outlandish claims, the unsuspecting pool participants contributed over $2 million which they plunged into Orvidas’ commodity pool. Not too long after, Orvidas lost nearly all these funds while trading but to cover his tracks, he provided the investors with fake spreadsheets which showed high trading profits and account balances.
Furthermore, he lied about why he couldn’t fulfil their return on investments or repay their capital with the fictitious profit he was showing. In the end, the investors lost their funds to the young Utah trader. It is worth noting that Orvidas was not registered as a commodity pool operator during this time.
CFTC Crack Down on Illegal Crypto Activities
Just like the Securities and Exchange Commission (SEC), CFTC has been making efforts to crack down on illegal crypto activities. Recently, three Decentralized Finance (DeFi) protocols were targeted for enforcement action by CFTC for failing to register a variety of derivatives trading offers.
Noteworthy, this enforcement action came about three weeks after the CFTC charged residents in Florida, Louisiana, and Arkansas for alleged fraudulent crypto trading.