The U.S. District Court for the Southern District of New York entered a default judgment against a U.K. man for operating a fraudulent scheme to solicit bitcoin from members of the public and misappropriating that bitcoin, the Commodity Futures Trading Commission (CFTC) said in a release.
- According to the court's March 2 order, Benjamin Reynolds, purportedly of Manchester, England, was ordered to pay nearly $143 million in restitution to defrauded customers and a civil monetary penalty of $429 million, the CFTC said.
- Reynolds has also been barred from engaging in conduct that violates the Commodity Exchange Act and CFTC regulations, registering with the CFTC and trading in any CFTC-regulated markets.
- Between May 2017 and October 2017, Reynolds used a website, social media accounts and email to solicit at least 22,190.542 bitcoin, valued at about $143 million at the time, from more than 1,000 customers worldwide, including at least 169 individuals living in the U.S., according to the release.
- Among other things, Reynolds falsely represented that his company traded customer bitcoin deposits in virtual currency markets and employed specialized virtual currency traders who generated guaranteed trading profits.
- The judgment is the result of a 2019 enforcement action brought by the CFTC.