Crypto platform defrauded investors, SEC alleges
According to the regulator’s complaint filed yesterday, between January 2020 and October 2021, the company allegedly sold memberships in the firm that promised investors high returns from its crypto trading and provided investors with incentives to recruit additional investors.
Those memberships amounted to securities, which weren’t registered, the SEC alleged. And, the company engaged in almost no trading on behalf of investors, it said. Instead, it reported fictitious profits to investors and misled them about the status of their accounts.
The SEC also alleged that Palafox misappropriated more than US$57 million of investors’ funds, and used most of the rest of the money to pay purported returns and referral…
