CFTC Fines Owner of Escrow Firm $7 Million Over Bitcoin Scam

An Easton man was ordered to pay $7.4 million in restitutions to resolve civil charges brought by the US Commodities Futures Trading Commission for stealing funds from two companies by lying about .
The enforcement action is the latest development in the case against , which has been running since 2018. The 49-year-old Pennsylvanian was indicted in 2019 for defrauding two customers buying Bitcoins through his firm Volantis, which operated a cryptocurrency escrow company called Volantis Escrow Platform LLC and a related company, Volantis Market Making.

A similar story had played out in both instances. Specifically, to buy bitcoins on behalf of two clients, which was then sent to a third party before receiving the purchased bitcoins. Thompson lied to the companies, saying “cash is with me, coin is with me,” and further claimed “there is no risk of default” since Volantis controlled “both sides of the transaction.”
In fact, Thompson sent the funds to another escrow service provider who never purchased the bitcoin promised or returned the funds, which were apparently lost in transaction.
“The order also finds that after Thompson took the customers’ money and failed to provide any Bitcoin, he then lied to the customers about the location of the Bitcoin, the reasons the transaction was not completed, and the status of the customers’ money,” said in a statement.
Symphony FS, an Irish firm thought to have been one of the victims of the fraud, alleges that Thompson never had the promised cryptocurrencies, which were never delivered to the customers, and the money was not safeguarded as promised.
Following investigations, Thompson was indicted in 2019 by a grand jury in the Southern District of New York on two charges of commodity fraud followed by two counts of wire fraud, which means that he could face up to 60 years in prison on conviction.
Yesterday, however, the court accepted Thompson’s plea of guilty to one count of commodities fraud, which carries up to 10-year prison sentence. He will be sentenced on January 7, 2021

Be First to Comment

Leave a Reply

Your email address will not be published. Required fields are marked *