Alleged Bitcoin Ponzi Scheme Assets Frozen as US Judge Grants Injunction
William Suberg's original article for cointelegraph.com reduced by 72%
A United States court has granted regulators a preliminary injunction against an alleged Bitcoin Ponzi scheme which reportedly defrauded investors of $11 million. In a filing with the United States District Court in Nevada dated Dec. 6, Judge Jennifer A.
Dorsey ruled in favor of the Commodity Futures Trading Commission and against Circle Society, along with its operator, David Saffron. "...I find that this is a proper case for granting a preliminary injunction and other equitable relief to preserve the status quo, protect customers from further loss and damage, and enable the Commission to fulfill its statutory duties," Dorsey wrote. Circle will now see its assets frozen, and the CFTC will be able to inspect its financial records prior to any further legal action.
The CFTC originally charged Circle Society and Saffron in late September, after investors complained that the latter fraudulently maintained an $11 million Bitcoin binary options offering. "According to the complaint, the defendants fraudulently solicited funds from at least fourteen members of the public to participate in a pool operated by Circle Society, an entity Saffron created and used to perpetrate his fraud, by making false claims of Saffron's trading expertise and guaranteeing rates of return up to 300%.". As Cointelegraph previously reported, enforcement action continues to impact even legitimate companies, with regulators specifically eyeing practices related to sales of tokens via initial coin offerings, or ICOs.
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