SEC accuses 11 people of over $300 million of crypto 'pyramid scheme'
SEC has filed a lawsuit in the United States District Court against the founders and promoters of Forsage, allegedly fueling a "Textbook Pyramid and $300 Million Ponzi". diet."
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The Securities and Exchange Commission (SEC) has indicted 11 people for their alleged role in creating a "fraudulent crypto pyramid scheme" Forsage platform.
The charges were filed Monday in a United States District Court in Illinois, with the SEC alleging that the platform's founders and promoters used the "fraudulent cryptographic pyramid and Ponzi scheme" to raise over $300 million from "millions of retail investors worldwide."
The SEC complaint says Forsage was modeled such that investors would be financially rewarded by recruiting new investors to the platform in a “typical Ponzi structure,” which spanned multiple countries, including the United States and Russia.
According to the SEC, a Ponzi scheme is an investment fraud that pays existing investors with funds raised from new investors. These schemes often solicit new investors by promising to invest funds in opportunities that generate high returns for little risk.
In the court filing, the SEC stated that:
"It [the Forsage Platform] did not sell or purport to sell any actual consumable products to bona fide retail customers during the relevant period and had no apparent source of income other than funds received from investors. The primary way investors made money with Forsage was by recruiting others into the program."
According to the SEC, Forsage's alleged Ponzi scheme works by first allowing new investors to build a portfolio of crypto-assets and buy "slots" from Forsage's smart contracts.
These slots would entitle them to earn compensation from others they recruited into the program, known as "downlines", and also from the Forsage investing community in the form of profit sharing, known as "spillovers" . ”
Carolyn Welshhans, ch...
SEC has filed a lawsuit in the United States District Court against the founders and promoters of Forsage, allegedly fueling a "Textbook Pyramid and $300 Million Ponzi". diet."
New
The Securities and Exchange Commission (SEC) has indicted 11 people for their alleged role in creating a "fraudulent crypto pyramid scheme" Forsage platform.
The charges were filed Monday in a United States District Court in Illinois, with the SEC alleging that the platform's founders and promoters used the "fraudulent cryptographic pyramid and Ponzi scheme" to raise over $300 million from "millions of retail investors worldwide."
The SEC complaint says Forsage was modeled such that investors would be financially rewarded by recruiting new investors to the platform in a “typical Ponzi structure,” which spanned multiple countries, including the United States and Russia.
According to the SEC, a Ponzi scheme is an investment fraud that pays existing investors with funds raised from new investors. These schemes often solicit new investors by promising to invest funds in opportunities that generate high returns for little risk.
In the court filing, the SEC stated that:
"It [the Forsage Platform] did not sell or purport to sell any actual consumable products to bona fide retail customers during the relevant period and had no apparent source of income other than funds received from investors. The primary way investors made money with Forsage was by recruiting others into the program."
According to the SEC, Forsage's alleged Ponzi scheme works by first allowing new investors to build a portfolio of crypto-assets and buy "slots" from Forsage's smart contracts.
These slots would entitle them to earn compensation from others they recruited into the program, known as "downlines", and also from the Forsage investing community in the form of profit sharing, known as "spillovers" . ”
Carolyn Welshhans, ch...
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