The Securities and Exchange Commission (SEC) moved to halt the operations of an alleged $12m crypto fraud targeting Latinos, according to a recently unsealed civil complaint.
Houston, Texas-based firm CryptoFX and its operators Mauricio Chavez, 41, and Giorgio Benvenuto, 55, were hit with emergency restraining orders and asset freezes at the end of September for allegedly running a ‘Ponzi scheme’ whose proceeds went to funding their lavish lifestyles, according to court filings.
According to the SEC, CryptoFX was founded in 2020 and billed itself as a ‘cryptocurrency learning academy’ which held in person classes on crypto assets and blockchain technologies that cost attendees anywhere from $499 to $1,499, the SEC said.
The regulator says Chavez and Benvenuto specifically targeted unsophisticated investors in Houston’s Latino community promising to educate them on how to build wealth through crypto asset trading.
However, the regulator claims the classes were used as a way of soliciting potential investors. Chavez and Benventuo allegedly began offering to trade their customers’ funds on crypto asset and foreign exchange markets, vastly overstating potential returns and convincing clients to sign short contracts known as venture agreements, per the SEC’s complaint.
The agreements were designed to raise capital from investors for Ponzi-style payments made out to Chavez and Benvenuto who provided investors with false documents and…
