The U.S. Securities Exchange Commission (SEC) has filed a lawsuit in federal court against 11 individuals, alleging securities violations related to a USD300 million crypto Ponzi scheme known as Forsage.
The complaint asserts claims not only against the founders and developers of the Forsage platform, but also against U.S.-based YouTubers and crypto influencers involved in the scheme. Given the SEC’s recent staffing increases in its crypto assets and cyber unit, this likely will not be the last case of its kind. Influencers and crypto news platforms who are perceived by regulators to be promoting and/or participating in fraudulent crypto schemes could face enforcement investigations, and possible enforcement action and civil liability.
SEC Complaint
According to the complaint filed 1 August1, Forsage is a Russia-based crypto investment platform that allegedly operates as a Ponzi scheme. The complaint names as defendants four Russian nationals who founded and managed the platform, and earned over USD4.8 million in profits. The SEC alleges that the founders misrepresented the machinations of the Forsage platform, promised unrealistic returns and passive income, and falsely claimed that the platform was not a Ponzi scheme, even after inquiries from multiple regulators.
The complaint also names as defendants seven individuals in the U.S. who promoted and participated in the scheme by investing and recruiting additional investors through various social media…
