🌎 New York Man to Pay $36M for Crypto Fraud, CFTC Case Settled

New York resident William Koo Ichioka has agreed to pay $36 million in a case brought by the Commodity Futures Trading Commission (CFTC) alleging cryptocurrency and forex fraud.

Details of the Fraud Case

According to a notice from Sept. 20, Judge Vince Chhabria of the U.S. District Court for the Northern District of California ordered Ichioka to pay $31 million in investor restitution for a crypto fraud scheme that started in 2018. Additionally, Judge Chhabria imposed a $5 million fine in favor of the CFTC.

Ichioka reportedly began raising millions from investors over six years ago, promising a 10% yield every 30 working days. The former San Francisco resident falsified financial statements and bank accounts to support his claims.

Misuse of Investor Funds

The CFTC stated that while Ichioka did invest the funds in digital assets and foreign exchange positions, he also spent investor money on personal luxury expenses. Prosecutors cited high-end apartments, watches, jewelry, and expensive cars funded with money entrusted to Ichioka. The commingling of funds and fraudulent practices meant investors never received the promised returns.

Regulatory Scrutiny Increases

Regulatory scrutiny by the CFTC and other bodies continues to advance as lawmakers debate possible regulations for the growing cryptocurrency industry. Recently, the CFTC settled a digital asset derivatives case with Uniswap, the largest decentralized exchange on Ethereum.

Recent Developments in Crypto Fraud

On Sept. 19, federal prosecutors charged two individuals with a $243 million theft. The two were part of a trio who scammed a Genesis creditor of over 4,000 Bitcoin.