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CFTC sues Ohio man over crypto Ponzi scheme

CFTC Encounters Problem Locating Accused Crypto Ponzi Scammer
CFTC Encounters Problem Locating Accused Crypto Ponzi Scammer

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The United States Commodity Futures Trading Commission (CFTC) has instituted a lawsuit against New Albany’s Rathnakishore Giri. The agency extended the lawsuit to hIs companies, SR Private Equity, LLC, and NBD Eidetic Capital LLC. Giri, through these companies, allegedly executed a fraudulent scheme.

According to CTFC’s recent statement,  the suit was filed at the United States District Court for Southern District, Ohio. As observed in the filing,  the defendant, through his firms, allegedly demanded over $12 million and 10 BTC from over 150 customers.  As part of the claim in the lawsuit, Giri’s firm also mismanaged funds reserved for customers’ crypto trading.

The lawsuit revealed Giri’s parents, Loka Pavani Giri and Giri Subranmani, were both accomplices in the fraud. They are both accused of being relief defendants, withholding funds without legal basis. 

The CFTC is now seeking an order against further violations of its regulations and the Community Exchange Act (CEA). The agency is also seeking civil monetary penalties, permanent trading and registration ban, and a refund of illegally obtained gains on violators.

The defendants allegedly carried out fraudulent activities from 2019 till they were apprehended this year by the CFTC. Over the last three years, his firms have fraudulently acquired more than $12 million and 10 BTC units. The firm employed various false and misleading statements, such as assurance of profits, and Giri’s presumed success as a digital assets trader, to defraud the unsuspecting customers.

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According to CFTC, Giri and his companies assured customers that their initial capital could be withdrawn anytime. They also promised interests at any time, which was false. As revealed, the funds obtained from the  150+ customers were invested in the defendant’s personal digital assets investment.

The complaint filed by CFTC stated in their solicitation to customers that the defendants excluded the material facts. It also includes the defendant’s mismanagement of public funds to pay profits to other customers in similar Ponzi schemes. The complaints also state that customers’ funds were used to finance Giri’s extravagant lifestyle, including yacht rentals, luxury vacations, and shopping. The defendants diverted customers’ funds to Giri’s trading accounts for digital assets. 

However,  the agency admonished the general public to always confirm a company’s registration status with the CFTC before investing their capital. The agency reaffirms its commitment to trailing and tracking various fraudulent projects and companies rocking the crypto world.

Recall in June that the regulatory body charged South African Bitcoin Club Mirror Trading International (MTI) for commodity fraud involving $1.7 billion.  It also indicted a crypto exchange, Germini, over a BTC futures misappropriation in 2017.

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