The US Commodity Futures Trading Commission said earlier this week that it had filed a complaint against four individuals and their unincorporated entity for operating a fraudulent project involving precious metals and digital assets.
The alleged scam had over 14,000 customers at one point.
- The complaint was filed in the US District Court for the Middle District of Florida against Rene Larralde, Brian Early, Alisha Ann Kingrey, and Juan Pablo Valcarce.
- The group of four, alongside their unincorporated entity called Fundsz, were charged with “fraudulent solicitation from clients to purportedly trade in cryptocurrencies and precious metals.”
- The press release informed that the project ran from October 2020 until now and promised investors over 3% returns per week using a “proprietary algorithm” for trading and something the founders described as “secret sauce.”
- Speaking of their historical performance, the four charged people claimed they had made “on-time and accurate payments” for seven years. Additionally, they said a one-time $2,500 investment in their project can be turned into $1 million within 48 months with no additional contributions.
- The founders also said they run a parallel charity organization and use portions of the contributions to Fundsz to support several initiatives, including cleaning oceans and others related to health, education, and humanitarianism.
- It seems Fundsz’ tactics had worked as it had amassed over 14,000 customers at its peak. However, the CFTC argued that the charged individuals never actually traded any funds. All clients’ gains are “illusory,” as the defendants “simply make up fictional weekly returns to report to customers.”
“The CFTC continues to root out individuals who defraud customers in the cryptocurrency and precious metals markets. Though the products fraudsters purport to trade and their methods of attracting victims – in this case through social media – may have changed, the old adage ‘if something sounds too good to be true, it probably is’ remains as valid as ever,” said Director of Enforcement Ian McGinley.
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