SEC Charges Operator of Fake Crypto Platform for $198 Million Fraud Scheme

The SEC has charged Ramil Palafox of PGI Global for a $198 million scam alleging fraud through a fake crypto trading platform. Palafox misused over $57 million of investor money for personal expenses in a Ponzi-like scheme. The SEC seeks penalties and fund recovery while criminal charges are also pursued, showcasing its dedication to regulating the crypto market.

The SEC has intensified its fight against cryptocurrency fraud by charging Ramil Palafox, the operator of PGI Global, which allegedly executed a $198 million scam. Palafox promoted PGI Global as a crypto and forex trading platform, luring investors with enticing membership packages and multi-level marketing incentives between January 2020 to October 2021.

Palafox misappropriated over $57 million of investor funds for personal luxuries, including luxury vehicles and retail purchases. He employed a Ponzi scheme strategy, using incoming funds to pay earlier investors their returns and referral bonuses until the scheme ultimately collapsed in 2021. Scott Thompson from the SEC highlighted Palafox’s deceptive tactics that misled investors into believing they were engaging in legitimate trading.

The SEC is pursuing penalties against Palafox for breaching anti-fraud and securities regulations, including demands for permanent bans and recovery of misappropriated funds. Additionally, criminal charges have been filed by the U.S. Attorney’s Office for the Eastern District of Virginia. This case underscores the SEC’s commitment to enforcing regulations in the crypto sector, targeting fraudulent operations similar to those in conventional finance.