15th October 2024 – (New York) The FBI has arrested executives from several prominent firms, including CLS Global, MyTrade, and ZM Quant, alongside 15 other individuals. This operation was initiated following an investigation into large-scale fraudulent activities involving digital assets, as reported by The Hacker News.
The Justice Department alleges that the indicted parties engaged in deceptive trading practices using a fraudulent cryptocurrency token and a fictitious firm named NexFundAI. These actions were reportedly designed to mislead investors by creating an illusion of market activity and profitability. The operation has resulted in the seizure of over $25 million worth of cryptocurrency, along with multiple wash trading bots used to inflate trading volumes artificially.
“Today’s enforcement actions demonstrate, once more, that retail investors are being victimized by fraudulent activity perpetrated by institutional actors in the markets for crypto assets,” stated Sanjay Wadhwa, Deputy Director of the Securities and Exchange Commission’s Division of Enforcement. He further cautioned investors to remain vigilant, noting that “the deck may be stacked against them” when dealing with purported market makers and promoters who promise unrealistic returns.
