Cryptocurrency Trader Under Legal Actions – According to the U.S Commodity Futures Trading Commission (CFTC), a cryptocurrency trader, Joseph Kim, a resident of the state of Arizona, is fined for performing a fraudulent trading scheme against his investors. As a result, he was sentenced to 15 months jail time by District Court in the Northern District of Illinois. The report was released on Friday, November 9, 2018.
Kim had stolen funds from his own employer in the months of September and November 2017. According to the press release, Kim had created his personal wallet. Similarly, he filled by transferring the company’s tokens from the cryptocurrency exchange. This happened at the Chicago-based trading firm.
Kim stated that transfer occurred due to the platform’s security issue but later his claim was found to be false. Hence, the firm discovered that the transfer was initiated by Kim himself. The funds which were transferred cost the company around $601,000. Therefore the firm immediately fired him.
Misleading the Investors.
Cryptocurrency Trader Under Legal Actions -After getting fired from the firm, Kim went on to set up his own company and solicited investment funds from unsuspecting investors. Furthermore, he attracted investors by falsely portraying himself as a good strategy maker in investments. As a consequence, he obtained funds around $545,000 to invest in the crypto market. Here he misled a minimum of five investors.
Kim lost all the funds from his investors by making poor investment decisions. Again he showed wrong account statements to his clients which claimed the total profit to his investors.
Legal Actions and Fine
The District Court fined Kim for $1.46 million, which he has to pay to his former employer and the investors. It also put a permanent ban on Kim for trading and registration activities. Director of Enforcement James McDonald called for the order issued against Kim.
Many enforcement laws are set up against fraudulent activities at crypto exchanges and The U.S Securities and Exchange Commission (SEC) has introduced many of these enforcement laws. A few weeks ago Ether Delta was charged by the SEC for running an “Unregistered national securities exchange” which was frequently charged to TokenLot LLC and Crypto Asset Management LP for registration failures in the past few months.