Pennsylvania Man To Pay $7.4 Mln To Settle Bitcoin Fraud Charge
By RTTNews Staff Writer | Published: 10/7/2020 10:24 AM ET
The Commodity Futures Trading Commission, or CFTC, has reached a settlement with a Pennsylvania man in a multi-million dollar Bitcoin fraud case. The CFTC announced that U.S. District Court for the Southern District of New York entered a consent order against Jon Barry Thompson, imposing injunctive relief and restitution of approximately $7.4 million.
The order resolved a CFTC enforcement action in which the CFTC charged Thompson with knowingly or recklessly making false representations to two customers in connection with their purported purchase of Bitcoin worth over $7 million.
According to the order, Thompson induced two customers in 2018 to send a combined total of over $7 million to fund the purchase of Bitcoin after making false representations that he or the escrow company he was affiliated with, had the Bitcoin in hand and the customers' money would be safeguarded.
Thompson took the customers' money and failed to provide any Bitcoin. He then lied to the customers about the location of the Bitcoin, the reasons the transaction was not completed, and the status of the customers' money, the order stated.
The order requires Thompson pay $7.43 million in restitution to the two customers, and enjoins him from any further violations of the Commodity Exchange Act or CFTC regulations, as charged.
The order also permanently bans Thompson from registering with the CFTC, from trading any commodity interests, and from trading Bitcoin for any account in which he has a direct or indirect interest.
This case was brought in connection with the CFTC Division of Enforcement Virtual Currencies Task Force. Thompson was charged in September 2019.
Simultaneously, U.S. District Judge Edgardo Ramos of the U.S. District Court for the Southern District of New York accepted Thompson's plea of guilty to one count of commodities fraud. Thompson will be sentenced on January 7, 2021.
Last week, the CFTC had charged cryptocurrency derivatives exchange Bitcoin Mercantile Exchange or BitMEX, for illegally operating an unregistered trading platform and for violating the anti-money laundering regulations. A civil enforcement action was filed in the U.S. District Court for the Southern District of New York.
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Article written by an RTT News Staff Writer, and posted on the RTT News.com website.
Article reposted on Markethive by Jeffrey Sloe