The Commodity Futures Trading Commission (CFTC) of the United States, has declared to file a civil prosecution action against Nevada headquartered Circle Society.
CFTC announced yesterday that it was indicting Circle Society and its owner, David Gilbert Saffron, on account of “fraudulent solicitation, misappropriation, and registration violations relating to an $11 million binary options scheme.”
The defendants have been charged for misappropriation of Bitcoin and U.S. dollars valued at around $11 million. They duped individuals in America to “trade off-exchange binary options on foreign currencies and cryptocurrency pairs, among other things.”
According to CFTC Chairman Heath P. Tarbert,
Fraudulent schemes, like that alleged in this case, not only cheat innocent people out of their hard-earned money, but they threaten to undermine the responsible development of these new and innovative markets. America must be a leader in this space, and we will only succeed if these markets have integrity.
Saffron created a fraudulent society, Circle Society. He then lured 14 investors with the promise that they would get a return of 300% on depositing funds in the society. Saffron apparently retained the funds of investors in his personal digital currency wallet and used it to pay new participants “in the manner of a Ponzi scheme.”
The CFTC will seek civil monetary penalties, compensation, revocation or cancellation of any kind of agreements made, repayment of gains earned unethically, and trading and registration bans on the organization. However, CFTC is also aware that Circle Society may not have enough funds or assets to pay for all the losses.