JPMorgan Sued Over Alleged Crypto Liquidity Pool Fraud Scheme Involving $328M
JPMorgan Chase has been sued over its alleged involvement in a $328 million cryptocurrency fraud scheme. A victim claims that the bank failed to detect and stop suspicious activity carried out by one of its customers, Goliath Ventures.
The lawsuit accuses JPMorgan of allowing Goliath Ventures to use its banking services despite allegedly operating a fraudulent investment program tied to decentralized finance (DeFi) liquidity pools.
Federal prosecutors recently charged the firm's chief executive, Christopher Alexander Delgado, with wire fraud and money laundering. The scheme allegedly raised hundreds of millions of dollars from investors who were promised unusually high monthly returns by being deployed in crypto liquidity pools.
However, investigators claim that most investor funds were never placed into liquidity pools as advertised, but rather diverted for personal spending or used to pay earlier investors to sustain the operation.