CFTC Requests Default As It Is Unable to Find $147M Bitcoin Ponzi Scammer

The United States Commodity Futures Trading Commission (CFTC) has requested that the alleged founder of the Bitcoin $147 million Ponzi scam Control-Finance be declared a default.

On April 3, the CFTC filed for a ruling of default after Benjamin Reynolds, Control-Finance’s alleged founder and director, did not answer to the regulator’s complaint.

CFTC fails to find Reynolds within 10 months

The CFTC’s complaint was filed in June 2019, stating that Ponzi scammer fleeced over 1,000 customers out of at least 22,858 Bitcoin from May 1, 2017.

In January 2020, the CFTC requested additional time to find Reynolds amid an ongoing investigation in South Korea.

During July 2019 the regulator has tried to serve Reynolds at two addresses associated with him but later learned from Control-Finance investors that the accused may be located in Korea.

The CFTC concurrently filed a notice of voluntary dismissal without prejudice against Control-Finance.

Ponzi scheme director escapes with $147 million

The CFTC’s complaint states that Control-Finance claimed to direct clients’ funds to the trading operations of its expert employees while in fact diverting new depositor’s funds to the scheme’s previous investors to build illusion of profits and foster hype.

The company created a pyramid scheme around a purported affiliate program, which was advertised on social media such as Twitter, Facebook and YouTube. In September 2017, Control-Finance wiped away its website, stopped making affiliate payouts, and removed advertising content from social media.

While claiming that clients’ funds would be returned during the following two months, the Ponzi scheme was liquidating the 22,858 Bitcoin it possessed for approximately $147 million, as CFTC discovered.

Control-Finance was going to launder the funds through thousands of transactions, with the BTC finally reaching wallets held with Canadian crypto exchange CoinPayments.