фото показано с : news.bitcoin.com

The US Commodities Futures Trading Commission (CFTC) helped bring a fraud case to court, hoping to both assist in its ultimate prosecution and establish precedent. The New York Eastern District Court decided in the CFTC’s favor, ending in a combined over $1.1 million decision in fines and restitution. It also established the regulator as having jurisdiction over cryptocurrencies. 

Also read: China Continues Crackdown: No Hotels, Malls, Offices Used as Crypto Venues

It’s rare a legal case accomplishes two firsts. In the proceedings taken against Patrick K. McDonnell, Cabbage Tech, and Coin Drop Markets, the New York Eastern District Court decided to not only rule against the defendant, but also wound up establishing standing for US regulator Commodities Futures Trading Commission (CFTC).

Until the decision handed down on August 23rd, 2018 in a 139-page Memorandum, it was assumed the Securities and Exchange Commission (SEC) would be the lone regulator when it came to cryptocurrencies in the US. As a result, part of the case involved the CFTC arguing for its jurisdiction when it came to crypto scams in general.

In what amounts to a permanent injunction, the defendant was ordered to pay more than a quarter million dollars in victim restitution along with a fine of more than $800,000, bringing the grand total to more than $1.1 million.

It was alleged during the first six months of 2017, the defendants fraudulently lured victims into believing they were purchasing and trading under the expert advice of Mr. McDonnell and Cabbage Tech. Evidently, Mr. McDonnell was listed as Chief Technology Officer, insisting he and Cabbage Tech had offices in places such as Wall Street, among other falsehoods about the company’s infrastructure, prosecutors claim.

Investigations revealed the company was a one man enterprise operated from Mr. McDonnell’s home. By summer of last year, the company’s website posted about being hacked, and declared it would suspend all activity. Not long after, the website and its chatroom, along with social media accounts, had been shuttered. Customers were left to wonder. By the beginning of this year, the CFTC charged defendants with “a deceptive and fraudulent virtual currency scheme for purported virtual currency trading advice; for virtual currency purchases and trading misappropriated [investor] funds.”

Though the CFTC prevailed, Mr. McDonnell maintained he was the subject of a political prosecution. As he explained to news.Bitcoin.com just a few months ago, he believed the “CFTC was grandstanding in Washington just weeks later of the complaint asking for a budget increase and pointing at their most recent ‘cryptocurrency’ enforcement. Much of this will come to light throughout the trial and you will see the CFTC was reckless in an attempt to force regulation. They needed something to point at,” Mr. McDonnell complained.

Is having the SEC and now the CFTC going after crypto scams a good thing? Share your thoughts in the comments section below.

Images via Pixabay.

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The post $1.1 Million Landmark Crypto Fraud Case Establishes CFTC Jurisdiction appeared first on Bitcoin News.

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