The CFTC has sued Cash FX over an alleged scheme that raised more than $950 million while promising weekly returns of up to 15%. Its complaint details Bitcoin payments, fabricated account statements and at least $406 million in participant losses.
A pitch promising weekly returns of up to 15% has led to a US civil case involving more than $950 million in investor funds. The Commodity Futures Trading Commission alleges Cash FX used almost all the money collected for purposes other than the forex trading it had promised. The case was filed in Florida on September 24 and announced by the agency on September 25.
The defendants are Cash FX Group and its CEO, Huascar Jose Lopez Castillo; The Conversion Pros and its CEO, Ronald Pope; and Justin Halladay. The complaint covers conduct from at least June 2019 through December 2023. The new development is the legal action over those earlier fundraising activities.
Bitcoin payments funded a forex pitch
According to the CFTC’s 62-page complaint, Cash FX promoted a combination of professional traders, proprietary bots and artificial intelligence. The agency alleges that less than 1% of participant funds actually went into forex trading. Instead, it says money from new participants funded payments presented to earlier participants as trading profits.
Bitcoin payments provide the case’s direct connection to crypto. The filing says participants were instructed to send BTC to Cash FX wallets and, in some instances, directly to Lopez’s personal wallets. The claimed forex returns and the route taken by funds on the blockchain are separate parts of the agency’s account.
One example concerns April 2021. The CFTC alleges that roughly 0.374 BTC received from about 19 participants, along with a small additional amount, funded payments totaling around 0.393 BTC to about 50 participants. It cites that sequence as an example of new money meeting existing withdrawal requests, rather than profits generated by trading.
Tracking a crypto transfer on-chain can show which address received the funds. The same record cannot establish that the recipient carried out its promised forex trades or earned the returns shown in a customer account. The complaint’s allegation of fabricated account statements brings that distinction into focus.
Funds raised and losses are different measures
The CFTC says the operation involved more than 400,000 participant accounts. That is not a count of unique individuals: the filing also describes participants opening multiple accounts. The agency puts net participant losses at no less than $406 million.
Two figures measure different things. More than $950 million represents the total funds allegedly collected. At least $406 million is the loss calculation after accounting for payments to participants. The larger figure is not a fine imposed or an award of damages.
In the announcement, CFTC Enforcement Director David I. Miller described the agency’s core mission as:
“Protecting the public from fraud and manipulation.”
The CFTC’s official September 25 announcement of the Cash FX case
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The agency is seeking restitution, disgorgement, civil monetary penalties and trading bans. Its complaint sets out allegations; it does not establish that a court has accepted them or ordered investors to be paid. For readers following forex market developments, the central issue in this case is where the money went and what it funded, before any claim about the returns it supposedly earned.
