CFTC Files Charges Against $12 Million 'Bitcoin Ponzi Scheme'

The CFTC claims an Ohio man and his associates used would-be investors’ cash and Bitcoin to fund a lavish lifestyle.

By Mat Di Salvo

Bitcoin Ponzi scheme. Image: Shutterstock

The Commodity and Futures Trading Commission today filed a civil enforcement action against a man for allegedly running a $12 million Bitcoin ponzi scheme to fund his lavish lifestyle. 

In a Friday statement, the CFTC said Rathnakishore Giri, of New Albany, Ohio, posed as a successful crypto trader. 

He then allegedly convinced over 150 would-be investors to hand over $12 million in cash plus at least 10 Bitcoins, today worth $240,326. 

Via his businesses NBD Eidetic Capital, LLC and SR Private Equity, LLC, Giri allegedly told customers he would re-invest their cash and capital into investment funds to make them returns—but this was a lie, according to the CTFC. 

The money was instead used by Giri to blow on fancy goods, the CTFC claimed. 

“The complaint also alleges in their solicitations to customers, the defendants omitted material facts, including the defendants misappropriated customer funds to pay profits to other customers in a manner akin to a Ponzi scheme and also misappropriated customer funds to pay for Giri’s lavish lifestyle, which included yacht rentals, luxury vacations and luxury shopping,” the CTFC said. 

The CTFC also named Giri’s parents, Giri Subramani and Loka Pavani Giri, as relief defendants for possession of funds to which they have no legitimate interest. 

Giri allegedly told investors they could take their cash out from the investment but that wasn’t true.

The CFTC said it is seeking restitution to the defrauded customers, disgorgement of ill-gotten gains, civil monetary penalties, permanent trading and registration bans, and a permanent injunction against further violations of the Commodity Exchange Act (CEA) and CFTC regulations.