CFTC accuses Cash FX Group of being involved in a $950 million Ponzi scheme: participants lost at least $406 million

The U.S. Commodity Futures Trading Commission (CFTC) has filed a lawsuit against Cash FX Group S.A. and its CEO Huascar Jose Lopez Castillo, The Conversion Pros Inc. and its CEO Ronald Pope, Justin Halladay, accusing the aforementioned defendants of operating a multi-level marketing Ponzi scheme that raised over $950 million from the public, including in the United States, claiming it was for retail foreign exchange contract trading.

The CFTC stated that the defendants falsely claimed that funds were traded by professional traders, proprietary algorithms, and AI, promising returns of up to 15% per week; in reality, Cash FX conducted only a small amount of foreign exchange trading, and almost all participant funds were misappropriated, paying fictitious trading profits to other participants using funds from new participants, while paying millions of dollars to the defendants. The CFTC claimed that Cash FX also provided participants with false account statements to maintain the illusion of high trading returns, resulting in participants losing at least $406 million. The CFTC is seeking to order the defendants to pay restitution, recover illegal profits, pay civil monetary penalties, and impose trading and registration bans as well as permanent injunctions.