Cryptocurrency and Forex Fraudsters Ordered to Pay $31 Million in CFTC Enforcement Action

The U.S. Commodity Futures Trading Commission (CFTC) has resolved its case against Alejandro Tinoco, a cryptocurrency and forex fraudster. Tinoco, who engaged in forex fraud and illegally obtained $9 million, has been sentenced to 84 months in prison and ordered to pay a $31 million fine to compensate 199 victims. This fraud case highlights regulatory efforts to protect cryptocurrency investors, and the court has issued an injunction against Tinoco’s company to prevent future violations. It further underscores the need for strengthened regulation in the cryptocurrency space.

The CFTC’s case against Alejandro Tinoco, who committed forex-related crimes and siphoned off millions, has been resolved. Tinoco, along with his company Kikit & Mess Investments, LLC, formerly based in El Paso, Texas, will jointly pay a total of $31 million in penalties in the CFTC’s cryptocurrency fraud enforcement action.

El Paso Forex and Cryptocurrency Fraud On July 9, the U.S. District Court for the Western District of Texas, under CFTC regulations, issued an order requiring Tinoco and his company to provide over $31 million in monetary relief. Specifically, this financial relief order mandates that the two companies compensate approximately 199 investors who suffered losses due to cryptocurrency fraud, totaling over $6.6 million.

Additionally, an extra $6.2 million will be allocated for victim restitution. The court has imposed a civil monetary penalty of $18.8 million, which is three times the amount of unlawful gains from their fraudulent forex and cryptocurrency scheme. Tinoco’s illegal activities involved a complex Ponzi-like scheme where he promised to invest clients’ funds in forex and crypto-focused funds but instead used the money for personal expenses, including luxury cars, private jets, real estate, and jewelry.

Tinoco Receives 84-Month Prison Sentence Two years ago, the court issued an initial consent order of permanent injunction against Tinoco and Kikit & Mess, prohibiting them from future violations of the Commodity Exchange Act (CEA) and CFTC regulations. It also barred them from trading in CFTC-regulated markets and registering with the CFTC. In October 2023, the U.S. Department of Justice convicted Tinoco of wire fraud related to telecommunications and sentenced him to 84 months in prison.

John Morales, a special agent with the FBI’s El Paso field office, stated that the defendant “orchestrated a sophisticated cryptocurrency investment fraud,” causing significant economic harm to unsuspecting victims.

This recent order resolves the CFTC’s enforcement action against Tinoco and Kikit & Mess Investments, emphasizing efforts to safeguard cryptocurrency investors and their assets.

Sentiment: Positive