SEC Alleges $198 Million Membership Scam by Praetorian Group International

The SEC accuses Praetorian Group International Corp. of being a $198 million Ponzi and pyramid scheme, led by Ramil Ventura Palafox. Investors were lured into buying membership packages with false promises of returns. The funds were misappropriated to benefit Palafox and settle obligations with earlier investors, leading to a significant financial loss for many individuals.

The SEC has filed a complaint against Praetorian Group International Corp., alleging it conducted a scam that raised $198 million through fraudulent membership packages. The company falsely promoted itself as a cryptocurrency and foreign exchange trading operation. Instead of engaging in legitimate trading, the operator, Ramil Ventura Palafox, reportedly siphoned off the funds to benefit his family and settle debts with earlier investors.

The scheme was primarily identified as a Ponzi and pyramid operation, with 29% of the funds—approximately $57 million—redirected to Palafox and his affiliates. The Securities and Exchange Commission underscored how Palafox lured investors by promising lucrative returns, relying on the greed of potential investors rather than any actual trading success.

The complaint, lodged in the US District Court for the Eastern District of Virginia, highlights a broader trend of fraudulent practices in the financial sector. It serves as a cautionary tale about the risks associated with investing in deceptively marketed financial schemes that promise unrealistic profits without transparency.