Fraudulent Cryptocurrency Trading Platform IcomTech Ordered to Pay $5 Million in Penalties

A federal court has ordered five individuals behind the IcomTech Ponzi scheme to pay $5 million in civil penalties and restitution for defrauding hundreds of investors through a fake cryptocurrency trading platform.

According to a recent statement, IcomTech founder David Carmona and four other promoters of the scheme, including Juan Arellano Parra, Moses Valdez, and David Brend, have been found guilty of violating the Commodity Exchange Act and Commodity Futures Trading Commission (CFTC) regulations.

Penalties and Restitution

The court has ordered the individuals to jointly pay over $1 million in restitution to defrauded customers. Additionally, each of the four individuals has been imposed a $1 million civil monetary penalty. Marco A. Ruiz Ochoa, who admitted to his role in the scheme, has been issued a consent order requiring him to pay restitution jointly with the others, bringing the total penalties to over $5 million.

The accused individuals also face a permanent ban from registering with the CFTC and trading in any CFTC-regulated markets.

The IcomTech Ponzi Scheme

IcomTech was touted as a Bitcoin mining and trading company that offered periodic returns of up to 100%. The scheme was active for a little over a year between 2018 and 2019 and managed to defraud hundreds of victims by promising daily returns between 0.9% and 2.8%.

The scheme fell apart in 2019 when the company couldn’t keep up with withdrawal requests. Instead, they handed out a token called “Icoms” as a so-called solution, but it turned out to be practically worthless, leaving investors with even bigger losses.

Warning Signs of a Ponzi Scheme

Investors should be cautious of schemes that promise unusually high returns with little to no risk. Some warning signs of a Ponzi scheme include:

  • Promising unusually high returns with little to no risk
  • Unregistered investments
  • Unlicensed sellers
  • Difficulty getting your money back

Consequences for Those Involved

Carmona and Brend have each been sentenced to 10 years in prison for their roles in the IcomTech Ponzi scheme. Ochoa, who admitted his involvement, received a lighter sentence of 5 years. Together, Carmona and Ochoa have also forfeited over $1.2 million in illicitly obtained funds.

Gustavo Rodriguez, who managed an online portal for IcomTech, was convicted of his role in setting up fraudulent investment packages and manipulating daily returns.

For more news on cryptocurrency and investing, visit Global Crypto News.

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