A judge in the United States has ordered a man convicted of running a major crypto and forex fraud scheme to pay $5 million in civil penalties and $31 million in restitution.
He Deceived More Than One Hundred Investors
William Koo Ichioka from New York started scamming people in 2018, causing millions of dollars in losses. According to the CFTC, he would lure people in by promising them a 10 percent monthly interest rate. This is a tactic that has been going on for a long time around the world. So how do they convince people of these high rates of return? They say it is very easy to do this today and in the future due to the high volatility of cryptocurrencies and leverage.
Investor Used Funds for Personal Expenses
Although Ichioka invested in some genuine crypto assets and forex investments, he used investors’ money to pay his rent, buy jewelry, watches, and luxury vehicles, and forged financial documents to perpetrate the scam.
A Classic Ponzi Scheme
The Department of Justice (DOJ) stated that the arrested fraudster continued the scam by paying back existing investors with new investor funds, emphasizing that this was a classic Ponzi scheme.
“Ichioka continued his fraud by paying existing investors with funds obtained from new investors.” – U.S. Department of Justice
Ichioka pleaded guilty to fraud charges in 2023 and was sentenced to 48 months in prison and five years of supervised release.
The CFTC initiated an enforcement action in parallel with Ichioka’s criminal conviction, persuading the court to bar him from trading in any market overseen by the commodities regulator. The U.S. Securities and Exchange Commission (SEC) also investigated Ichioka.
This situation once again highlights the risks that investors in the crypto and forex markets may face. It is important for investors to be wary of offers that seem too good to be true and to do thorough research when making their investments. Regulatory bodies continue to protect investors by taking precautions against such fraudulent activities.
Disclaimer: The information contained in this article does not contain investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
