SEC Charges Ramil Palafox in $198 Million Crypto Fraud Scheme

Ramil Palafox has been charged by the SEC for leading a $198 million crypto fraud scheme through PGI Global, allegedly misusing millions for personal purchases. The SEC seeks to recover ill-gotten gains and prevent future violations. In a related case, Iranian national Behrouz Parsarad faces charges for operating a dark web marketplace facilitating drug trafficking and financial crimes.

The US Securities and Exchange Commission (SEC) has brought charges against Ramil Palafox, a dual US-Philippine citizen, for orchestrating a $198 million crypto fraud scheme. Operating between January 2020 and October 2021 through his company, PGI Global, Palafox allegedly ran a Ponzi-style operation, misleading investors and misappropriating funds intended for investment.

According to the SEC, Palafox raised approximately $198 million from investors globally, promising substantial returns through crypto and foreign exchange trading. However, the regulator claims he diverted over $57 million for personal expenditures, including luxury items. Associate Director Scott Thompson highlighted the fraudulent nature of Palafox’s promises, stating that rather than trading, he used investors’ money for personal gain.

Furthermore, PGI Global functioned on a multi-level marketing (MLM) basis. Palafox purported to possess expertise in cryptocurrencies and to operate an AI-driven trading platform, both of which were fraudulent claims. The scheme ultimately collapsed in 2021, inflicting significant financial harm on investors.

The SEC has filed its complaint in the US District Court for the Eastern District of Virginia, charging Palafox with violating anti-fraud regulations and seeking the return of ill-gotten gains and civil penalties. They also request a permanent injunction to stop Palafox from future misrepresentations. Additionally, criminal charges have been filed by the US Attorney’s Office against him.

In a separate development, Iranian national Behrouz Parsarad has been indicted for establishing a dark web marketplace named Nemesis, responsible for illegal drug sales including fentanyl, along with financial crimes. Between 2021 and 2024, it processed over 400,000 orders. Parsarad faces charges that include money laundering involving cryptocurrency.

This heightened focus on regulating the cryptocurrency field and addressing cybercrime has emerged through multiple recent arrests, underscoring the United States government’s commitment to curbing illegal activities within the sector.