SEC Charges PGI Global Founder in $198M Crypto Fraud Case
The scam allegedly siphoned more than $57 million into personal luxury purchases, including Lamborghinis, watches, and homes.
According to the SECs complaint filed in U.S. District Court for the Eastern District of Virginia, PGI Global promoted itself as a crypto and forex trading platform, offering high returns and multi-level marketing incentives to lure global investors. From January 2020 to October 2021, Palafox allegedly used new investor funds to pay earlier ones a hallmark of a Ponzi-like scheme until the platform collapsed.
Palafox bought himself and his family cars, watches and homes using millions of dollars of investor funds, said Scott Thompson, Associate Director of the SECs Philadelphia Regional Office. We will continue to investigate and take action against bad actors who take advantage of investors.
AI Claims Used as Bait
SEC officials also said Palafox masked the fraud behind claims of a cutting-edge AI-powered auto-trading platform and crypto expertise, exploiting the crypto boom to build trust and credibility.
His false claims were just masking an international securities fraud, said Laura DAllaird, another SEC official involved in the case.
The SEC is seeking permanent injunctions, disgorgement of ill-gotten gains, and civil penalties against Palafox.
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