SEC Charges 11 People in $300 Million Crypto Ponzi Scheme

The SEC has prosecuted 11 people for their roles in the development and promotion of a $300 million cryptocurrency Ponzi scheme. The suspects, who succeeded in defrauding investors from all over the world, including the United States, and raising more than $300 million, have been detained by the Securities and Exchange Commission.

The founders of the Forsage scheme, who the SEC claimed were citizens of Russia, Indonesia, and the Republic of Georgia, are among those who have been prosecuted. Members of the Crypto Crusaders, a sizable promotional organization, are some of the other people the SEC has prosecuted.

Vladimir Okhotnikov, Jane Doe (also known as Lola Ferrari), Mikhail Sergeev, and Sergey Maslakov created Forsage.io in January 2020 by the SEC’s lawsuit. Through the use of smart contracts that operated on the Ethereum, Tron, and Binance blockchains, this website enabled millions of retail investors to transact.

On the other hand, Forsage is alleged to have operated for almost two years as a pyramid scheme where investors profited by recruiting others to join the scheme. According to reports, Forsage used money from new investors in a conventional Ponzi scheme to pay off previous investors.

According to Carolyn Welshhans, acting chief of the SEC’s Crypto Assets and Cyber Unit,

“As the complaint alleges, Forsage is a fraudulent pyramid scheme launched on a massive scale and aggressively marketed to investors.” “Fraudsters cannot circumvent the federal securities laws by focusing their schemes on smart contracts and blockchains,”

Along with the usual accusations, the founders were accused of breaking the federal securities laws’ anti-fraud and registration provisions. Two of the defendants, however, consented to resolve the allegations and follow through. However, they have not confirmed or refuted the accusations.

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