Cash FX Group Sued Over Alleged $950M Crypto-Linked Forex Scheme
The Commodity Futures Trading Commission (CFTC) has filed a lawsuit against Cash FX Group and three individuals over an alleged $950 million cryptocurrency-linked foreign exchange investment scheme.
The CFTC claims that Cash FX, founded by Huascar Jose Lopez Castillo, took money from over 400,000 customer accounts, causing at least $406 million in losses. The agency alleges that the company misrepresented its trading practices, telling participants that 70% of their contributions would go toward foreign exchange trading, while the remaining 30% would fund an 'Academy Program' offering trading education.
However, the CFTC claims that less than 81% of the money collected was used for forex trading. The agency also alleges that some payments to earlier participants came from funds contributed by later participants.