Californian Court Orders Over $5 Million Penalty In Bitcoin Ponzi Scheme

According to Cointelegraph, a Californian court has mandated five individuals involved in the IcomTech Ponzi scheme to pay more than $5 million for fraud and misappropriation of funds through a fraudulent Bitcoin trading operation. The court's default judgment identified David Carmona, Juan Arellano Parra, Moses Valdez, and David Brend as liable for all violations of the Commodity Exchange Act and Commodity Futures Trading Commission (CFTC) regulations as outlined in the complaint. Marco A. Ruiz Ochoa received a consent order, as stated by the CFTC in a December 11 announcement. The judgment, issued on October 21, stemmed from a lawsuit filed by the CFTC on May 24, 2023. The five individuals fraudulently solicited over $1 million from 190 people in the United States and other countries, falsely promising to invest their funds in Bitcoin and other cryptocurrencies through a non-existent mining and trading platform. Instead, they misappropriated a significant portion of the victim's funds, estimated at approximately $8.4 million as of December 2022. Carmona, Arellano Parra, Valdez, and Brend are each required to pay a $1 million civil monetary penalty. Alongside Ochoa, they must also pay approximately $1 million in restitution to the victims, bringing the total to over $5 million. Additionally, all five individuals have been permanently banned from registering with the CFTC and from trading in any CFTC-regulated markets. David Carmona, the founder and mastermind behind IcomTech's Ponzi scheme, was sentenced to 10 years in prison for conspiracy to commit wire fraud in October. Rodriguez received an eight-year sentence on October 31 for his involvement, while Brend was sentenced to 10 years on December 2. Ochoa was sentenced to five years in January for conspiracy to commit wire fraud. Operating between mid-2018 and the end of 2019, IcomTech promised investors a 100% return on their investment every six weeks. The operators frequently traveled across the United States and overseas, hosting extravagant expos to entice victims into the Ponzi scheme. They often arrived at these events in luxury cars, dressed in expensive clothing, and boasted about their profits to persuade potential investors that they could achieve similar financial success.