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CFTC Reports Arizona Native Fined $1.1M For Shady BTC And LTC Schemes

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CFTC Reports Arizona Native Fined $1.1M For Shady BTC And LTC Schemes

Authorities in the U.S. have upped their game in pursuit of people running illegal and fraudulent cryptocurrency schemes. Likewise, Arizona native Joseph Kim is the latest to feel the full force of the law. According to CFTC reports, Kim will spend 15 months in jail and pay a $1.1M USD fine for misappropriating Bitcoin (BTC) and Litecoin (LTC) holdings from several people.

CFTC Cryptocurrency Crackdown on Kim

The Commodity Futures Trading Commission accuses Kim of defrauding his employer. Initial indication is that the suspect transferred $601,000 worth of BTC and LTC to his account without authorization. Kim, on his defense, alleges that the transfer was inevitable because of security issues.

Kim allegedly defrauded other investors as he sought to return some of the funds to his employer. The CFTC alleges that he could have lured up to $545,000 worth of cryptocurrencies from at least five individuals as part of the scheme. The Chicago-based trading firm later on fired Mr. Kim and reported him to authorities.

The suspect lied to the individuals by stating he had left the trading firm to start his own firm. Things appear to have gotten out of hand on him losing investors‘ fund on engaging in high-risk bets. Kim consequently pleaded guilty to misappropriating investors’ funds.

Similarly, the CFTC in its ruling maintains that the greedy miscreant will have to pay $1.1M USD restitution to affected investors and company. The suspect will also have to abstain from any form of trading or solicitation. Kim will also have to spend 15 months in jail as part of separate criminal charges leveled by the U.S. Attorney in the Northern District of Illinois.

Kim is not the first person to find himself at loggerheads with authorities over illegal cryptocurrency activities. The U.S. Securities and Exchange Commission has already hit Zachary Coburn with a $400,000 fine. The founder of crypto token trading platform EtherDelta will pay the fine for running an unregistered securities exchange.

Cryptocurrency Regulation

The ruling underscores how regulators are maintaining watchful eye on the burgeoning sector. Lack of regulations to govern cryptocurrencies like BTC and LTC will not in any way slow down the agency’s crackdown on illegal investment schemes.

CFTC director of Enforcement, James McDonald, maintains they remain well-equipped to prevent cryptocurrency related crimes. The agency has since teamed up with the U.S. Department of Justice and the FBI as part of a drive to bring sanity to the cryptocurrency sector.

Risk Disclosure

This article should not be taken as, and is not intended to provide, investment advice. Users are ultimately responsible for the investment decisions he/she/it makes based on this information. It is your responsibility to review, analyze and verify any content/information before relying on them. Trading is a highly risky activity. Do consult your financial adviser before making any decision. Please conduct your thorough research before investing in any cryptocurrency and read our full disclaimer.

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