Crypto scammers ordered to pay $5m for IcomTech Ponzi

Five backers behind the IcomTech Ponzi scheme have been ordered to pay $5 million in fines and restitution for defrauding investors through a fake cryptocurrency trading platform.

According to a statement made on December 11, IcomTech founder David Carmona, along with four backers of the plan, Juan Arellano Parra, Moses Valdez and David Brend, filed a lawsuit for violating the Commodity Exchange Act and Commodity Futures Trading Commission regulations.

The court ordered them to jointly pay more than $1 million in damages to the defrauded customers and fined each of the four people $1 million.

Additionally, a consent order was issued to Marco A. Ruiz Ochoa, who admitted his role in the scheme, requiring him to pay restitution along with others, bringing the total penalty to over $5 million.

The defendant also faces a permanent ban from registering with the CFTC and trading on any market regulated by the CFTC.

IcomTech was launched as a Bitcoin mining and trading company offering periodic returns of up to 100%. The scheme was active for just over a year between 2018 and 2019 and managed to defraud hundreds of victims by promising daily returns of between 0.9% and 2.8%.

The scheme collapsed in 2019 after the company was unable to meet withdrawal requests. Instead, they distributed a token called “Icoms” as a so-called solution, but it turned out to be worthless in practice, causing investors even greater losses.

The complaint alleges that the five men solicited over $1 million from 190 people and promised to trade Bitcoin and other digital assets on their behalf. Rather than using the funds for trading as advertised, the defendants misappropriated the funds, causing significant losses to the victims.

Meanwhile, the funds were used to fund lavish lifestyles and host extravagant exhibitions to lure more unsuspecting victims into their schemes.

The CFTC first filed a civil enforcement action in May 2023, which resulted in significant civil consequences, including prison terms and fines for those involved.

While Carmona and Brend were sentenced to 10 years in prison for their roles in the IcomTech Ponzi scheme, Ochoa, who admitted his involvement in this business, received a lighter sentence of 5 years.

The statement stated that Carmona and Ochoa together forfeited more than $1.2 million in illegally obtained funds, while Carmona lost $329,450 and Ochoa lost $914,000. The statement said Brend was fined $40,000 as part of his sentence.

In March this year, Gustavo Rodriguez, who ran IcomTech’s online portal, was found guilty of his role in creating fake investment packages and manipulating daily returns.