The US securities and exchange Commission (SEC) has sued three organizers of a cryptocurrency fraud scheme called Modern Money Team (MMT).
According to a lawsuit filed in Federal court in salt lake city on may 7, the suspects are accused of organizing a “multi-level marketing scheme” through which they were able to obtain more than $12 million.
The lawsuit was filed against MK Distribution and R&D Global, as well as the organizers of the scheme, Daniel Putnam, Jean Paul Ramirez Rico and angel Rodriguez.
The scheme’s organizers described MMT as a “community of traders” and offered products related to trading cryptocurrencies, options, and foreign currencies. The lawsuit notes:
“Putnam sold shares in what he called the mining business, with about two hundred people affected. He embezzled some of the proceeds and spent them on a condo and other private expenses. Subsequently, all three raised additional money by offering so-called “cryptocurrency trading packages” and promised high returns to investors. However, the funds were stolen, and the first investors received money under the pyramid scheme.”
Earlier, the SEC accused the BitClave project of conducting an unregistered ICO. BitClave announced that it will return funds to all ICO participants, as well as pay a fine of $400,000.