The U.S. Department of Justice (DoJ) announced the arrest and indictment of multiple individuals and entities for allegedly manipulating digital asset markets as part of a widespread fraud scheme.
Law Enforcement Action – Codename operation token mirror – This is the result of the US Federal Bureau of Investigation (FBI) taking the “unprecedented step” of creating its own cryptocurrency token and company called NexFundAI.
According to information on its website, NexFundAI is touted as redefining “the intersection of finance and artificial intelligence” and aims to “act not only as a secure store of value, but also as a catalyst for value.” It is said that the purpose is to create a cryptocurrency token that Bringing positive change to the world of AI. ”
“Three market makers, ZM Quanto, CLS Global, and MyTrade, and their employees, wash trade and/or He has been charged with conspiring to engage in wash trading.The results of the government investigation have been disclosed,'' the Justice Department said.
“A fourth market maker, Gotbit, its CEO and two directors are also charged with carrying out a similar scheme.”
A total of 18 people and entities were implicated in the investigation, with five defendants pleading guilty or agreeing to plead guilty. The other three defendants were arrested in the US state of Texas, the UK and Portugal.
More than $25 million in cryptocurrencies was also seized, with approximately 60 different cryptocurrencies behind wash trading (also known as round-trip trading), which refers to the illegal practice of buying and selling the same financial instrument to create artificial market activity. Several trading bots were seized. Disabled.
According to court documents, the cryptocurrency company defendants used their tokens to conduct bogus transactions in an attempt to attract new investors and buyers, creating the impression that they were a good investment. This is said to have artificially inflated the trading price of the token.
The individuals then sold the tokens at a new price, a fraudulent scheme known as pump-and-dump, in order to illegally profit from the financial crime.
The following individuals and virtual currency companies were indicted:
- Alexei Andriunin, Fedor Kedrov, Kawi Jalili, Gotbit Consulting LLC (Gotbit)
- Riqui Liu, Baijun Ou, ZM Quant Investment LTD (ZM Quant)
- Andrey Zhorzhes, CLS Global FZC, LLC (CLS)
- Liu Zhou, MyTrade MM
- Manpreet Kohli, Haroon Mohsini, Nam Tran, Max Hernandez, Russell Armand, Vy Pham, Saitama LLC (Saitama)
- Robodog Finance (Robodog)
- Michael Thompson, VZZN,
- Bradley Beatty, Lillian Finance LLC
“Today's enforcement actions demonstrate once again that retail investors are being victimized by institutional fraud in the crypto markets,” said Sanjay Wadhwa, Deputy Director of the SEC's Division of Enforcement.
“As so-called promoters and self-appointed market makers collude to target retail investors with false promises of profiting from the crypto market, investors are left with no idea what they are doing against them. It should be noted that there is a possibility of stacking.
