Crypto Platform Debiex is ordered to pay around $2.5 million after failing to respond to the US Commodity Futures Trading Commission, which accuses it of being a romance fraud ring.
On March 13, Arizona Federal Court Judge Douglas Rays granted CFTC's previous claim of summary judgment in the case, ordering Debiex to repay approximately $2.26 million stolen from a client, bringing the civil penalty to nearly $221,500.
Judge Rays said there was no evidence that Debiex's failure to respond to the CFTC was the result of “excusable negligence.”
The CFTC sued Debiex in January 2024, saying that staff would carry out what is called “pig slaughter” scams and start romantic relationships with customers via social media and gain trust to invest in the platform.
According to the CFTC, the scheme deposited five victims with Debiex, who totaled around $2.3 million.
Highlighted excerpt from Judge Rays' order summarizing CFTC cases against Debiex, source: CourtListener
The CFTC also accused Zhāng Chéng Yáng of being Debiex's “money mule.”
Judge Rays admitted to the CFTC's allegations seeking a default judgment against Zhāng on March 12, claiming that he was in control of the crypto wallet with OKX “he received a digital asset that had no legitimate claims.”
He said OKX would “voluntarily store” the code on Zhāng's account and order content consisting of $5.70 worth of tethers (USDT) and nearly $119,500 worth of 63 ethers (ETH) and forward them to the unnamed victims.
In a January 2024 complaint, CFTC said that Debiex's scheme had directed it to a website that created the marketing itself as a “blockchain network decentralized, permanent contract trading platform” that allows users to conduct futures and “mining transactions” targeting potential victims through social media.
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Debiex staff existed as a woman and developed relationships with victims through “continuous and repetitive messaging and sharing photos of themselves” while claiming to be a highly successful digital asset product trader.
Once an account is created and the customer is sent via encryption, CFTC said Debiex will share “fictitious information” about customer balances, transaction positions and profits.
“It's likely that all this information was wrong,” the CFTC said. “The evidence shows that the customer's digital assets have been sent to numerous digital asset wallets to obfuscate the destination.”
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