Wall Street Watchdog accuses 11 in massive crypto ponzi scheme

The Securities and Exchange Commission has accused 11 people in an alleged $ 300 million crypto pyramid system and emphasized how the authorities increase their enforcement on the markets for digital assets.

The Wall Street Wachhund said that the program known as a Forsage has applied the funds by using promoters to convince millions of investors worldwide to recruit others for the program.

"Forsage is a fraudulent pyramid system that is introduced to a large extent and aggressively marketed to investors," said Carolyn Welshhan, incumbent director of the Cypto Asset and Cyber unit of the SEC. "Fraudsters cannot bypass the federal government laws by concentrating their systems on smart contracts and blockchains."

The SEC accused the operators of Forsage to have applied $ 300 million in the United States in the United States and worldwide from at least January 2020 by a non -registered securities offer. The civil lawsuits come only a few weeks after the supervisory authority has charged a former employee of the Coinbase crypto exchange for insider trade. The former Coinbase employee said about his lawyer that he was "innocent in all misconduct".

The cases underline how the SEC uses existing securities rules to monitor the market for digital assets, which its chairman Gary Gensler has called the "wild west".

The SEC said in a complaint submitted to the Federal Court in Illinois that Forsage "did not sell or sold or for sale to good -faith -faithful product during the relevant period and had no other obvious source of income than investors received".

Forsage used smart contracts-computer programs that enable crypto trading without a central intermediary-to operate the system, said the Sec. The contracts are traded on the blockchains Ethereum, Tron and Binance - digital ledger, which, according to the regulatory authority, are widespread in the crypto industry.

investors of the project would receive remuneration from others who recruited them, and from the people who moved these people into the project. Investors also earned profit sharing fees from the broader community.

"All payments to former investors were given by funds received by later investors," said the Sec.

A representative of Forsage, which was reached via the group of the group and described himself as a volunteer for the decentralized organization, said that the accusations of the SEC were "nonsense of cryptocurrency newcomers and not true".

The accusations of the Sec include the four founders of Forsage - Vladimir Okhotnikov, Mikail Sergeev, Sergey Maslakov and a person known as the pseudonym Lola Ferrari. Okhotnikovs and Ferrari's last known locations were the Republic of Georgia and Indonesia. Sergeev and Maslakov were both known in Moscow. The people could not be achieved for a statement.

The SEC also accused three supporters of the program based in the USA and members of an advertising group for the program called Crypto Crusaders, who worked in at least five US states.