EminiFX chief pleads guilty to fraudulent scheme worth over $240M

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The U.S. Department of Justice (DOJ) has received a guilty plea from Eddy Alexandre, CEO of EminiFX, on charges of fraud and misrepresentation of digital assets.

Authorities confirmed that Alexandre admitted to defrauding thousands of investors of over $248 million within a seven-month period. Investors were lured in with the promise of earning high returns on their investments in digital assets and foreign exchange trades.

“Eddy Alexandre admitted today to luring investors to his cryptocurrency investment scam by fabricating weekly returns of at least 5%. In reality, Alexandre failed to invest a substantial portion of this investors’ money and even used some funds for personal purchases,” U.S. Attorney Damian Williams said.

Federal investigators shed light on the depth of the scam operations, including the claim that the trades were made using the help of “secret technology” and a Robo-Advisor Assisted account.” Authorities said Alexandre misappropriated the funds from tens of thousands of investors, diverting $14.7 million to his personal bank account.

Prosecutors disclosed that Alexandre diverted $155,000 of victims’ funds to purchase a BMW automobile while $13,000 was used to finance the purchase of a Mercedes Benz car.

“Alexandre’s scam caused investors to lose millions of dollars, and this case should serve as yet another warning to cryptocurrency executives that the Southern District of New York is closely watching and ready to prosecute any and all misconduct in the crypto markets,” Williams said.

Alexandre has agreed to forfeit $248 million and pledges to pay any amount specified by the court as restitution. Despite pleading guilty, Alexandre still faces the grim possibility of up to ten years in prison as the punishment for commodities fraud.

DoJ’s seizures and convictions

The DoJ has a streak of seizures and convictions against ‘crypto’ fraudsters in its wake, beginning from the busts against the Silk Road operatives back in 2014. In July 2022, the DoJ announced a seizure of $500,000 worth of digital currencies from hackers linked with North Korea’s government.

The Department’s agencies had a prolific streak as they recovered a portion of the ransom payments of the Colonial Pipeline attack from the bad actors. To stay on top of virtual currency crime, the DOJ announced the creation of the Digital Asset Coordinator (DAC) Network, with staff being drawn from the U.S. Attorneys’ Offices throughout the country.

In the last 12 months, several high-profile convictions have been achieved by the Department’s prosecutors, with millions of dollars worth of restitution being paid to victims.

Watch: Law & Order Regulatory Compliance for Blockchain & Digital Assets