The Commodity Futures Trading Commission (CFTC) for organizing a Bitcoin scam scheme and Litecoin sentenced the trader to imprisonment and obliged him to pay a fine of more than $ 1 million.
Trader Joseph Kim admitted to deceiving investors for hundreds thousands of dollars after stealing more than $ 600,000 from a previous employer, which was a Chicago-based trading company. Funds in Bitcoins and Litecoin were transferred from September to November 2017.
When the employer asked Kim about the missing coins, he lied that for security reasons, the cryptocurrency exchanges demanded transfers to other accounts. After the deception was revealed, he was immediately fired from the company.
Soon he began to ask money from ordinary citizens, presumably to continue to sell cryptocurrency to pay damages to the former employer. As a result, in the period between December 2017 and March 2018, at least five citizens fell for his deception, who gave him about $ 545 thousand.
As noted in the document, Kim lied that he voluntarily left work to open his trading company. He also promised that he would deal with low-risk arbitrage transactions. However, in fact, he performed high-risk operations with cryptocurrencies, which led to the loss of all investors’ funds.
In addition to a fine of $ 1.146 million, the Commission permanently banned Kim from trading, including cryptocurrency, sentencing him to 15 months in prison.
Earlier in the United States there were similar precedents. So, in January 2018, the Commodity Futures Trading Commission filed a lawsuit against two companies for organizing scam investment scheme and embezzling depositors’ money.