SEC Charges Eleven Individuals Linked to the Crypto Pyramid Scheme Forsage

The Securities and Exchange Commission of the United States indicted 11 individuals on August 1st for participating and promoting a crypto pyramid scheme called Forsage through which they were able to gain more than 300 million USD globally.

According to the SEC, the defendants include 4 founders last seen in Russia, 3 promoters currently in the U.S. and other members of Crypto Crusaders, who were involved in promoting Ponzi schemes.

Forsage Logo

Forsage operated as a pyramid scheme for 2 years

Forsage was founded under the idea of serving as a bridge between Ethereum and Tron. It was intended to allow smart contracts to be executed across multiple chains. It was a crypto pyramid scheme that operated for two years. The money received from new investors was used to pay out old investors and reward people who recruited more.

According to the press release the SEC had sent cease-and-desist letters to Forsage late 2020 and march 2021. However, Forsage’s founders chose to ignore regulators. Instead, they continued to promote the platform by denializing the allegations of crypto fraud through their YouTube accounts, while also promoting the platform.

Carolyn Welshhans, Acting Head of the SEC’s Crypto Assets Cyber Unit, stated that “fraudsters cannot bypass the federal securities laws by focusing on smart contracts and Blockchains.” This harms retail investors who have saved their money in these types of platforms and trust the promises of their promoters.

Two of the defendants from the US agreed to disgorgement and civil penalties, as ordered by the court, to settle the SEC charges. They were cleared of any other violations.

SEC and FBI team up to fight crypto crime

CryptoPotato reported recently that the SEC had charged several people in relation to crypto-related activities. This included a former Coinbase executive. As the first case of insider trade in the crypto industry, the SEC closed the Ishan Wahi case. This shows that the SEC is taking a more active role in enforcing law against actors who use cryptocurrency to promote frauds, thefts, pyramid schemes, and other criminal activities.

Michael J. Driscoll (deputy director of FBI) stated that the FBI is more involved in the crypto ecosystem to stop criminals using loopholes in cryptocurrency to commit crimes.

Similar to the above, Letitia James, New York Attorney General, urged all New Yorkers that they had been victims of any cryptocurrency fraud on August 1st to file a complaint with the prosecutor’s offices.

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Marla Brooks

Marla Brooks – Financial Analysis My name is Marla Brooks, and I am the mainstream behind the”observednews.com”  for the powerful and most delicate insights into the latest activities in the financial analysis category. I started my journey as an independent financial consultant. I had approximately nine years of experience in this field. I am free soul so; my passion for exploring the world has taken me to the nations across the globe and given me the chance to report for a portion of the best news associations. Currently, I am a full-time editor as experienced in finance and started to use my abilities.

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