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According to a complaint filed by the CFTC in the U.S. District Court for the Middle District of Tennessee, from July 2022 through January 2023, Michael & Amanda Griffis operated a multi-million dollar commodity pool called Blessings of God Thru Crypto.
Defendants contacted their colleagues and clients in the real estate industry to entice them to join the pool. Despite having no trading experience, the organizers of the scheme managed to convince over 100 people to send them over $6 million. Using their professional connections, they were able to convince the victims that the “project” was legitimate.
The Griffis assured investors that their funds were safe and under control and promised high returns. They claimed that the money invested would be used to trade cryptocurrency futures on the Apex Trading Platform on the advice of a certain “Wendy’s coach”.
According to the regulator, instead of sending money to the trading platform, more than $4 million was transferred to various digital wallets outside of the defendants’ control, and those funds are now unrecoverable. In doing so, the Griffises misappropriated about $1 million, spending it to pay off their debts and buy luxury goods.
The CFTC ordered the violators to return the funds to the defrauded pool participants and pay an administrative penalty. In addition, the regulator believes it is appropriate to permanently prohibit spouses from organizing trading in such financial instruments to avoid further violations of the Commodity Exchange Act (CEA) and CFTC rules.
Earlier this month, the agency charged two Florida citizens with more than $5 million in bitcoin fraud. In the wake of increasing cases of crypto fraud, former CFTC Chairman Timothy Massad suggested that the agency develop rules to regulate the industry with the U.S. Securities and Exchange Commission (SEC).