The Commodity Futures Trading Commission (CFTC) has ordered that Jacob Orvida, a Utah man, pay restitution and a penalty of $2.5 million for allegations of fraud in a leveraged Bitcoin ploy. According to the CFTC, Orvida solicited investors to join a commodity pool to trade levered Bitcoin and promptly lost almost all the funds. Orvida had failed to register as a commodity pool operator.
CFTC Director of Enforcement Ian McGinley said protecting investors is what the CFTC’s digital asset enforcement program is designed to do.
“While digital-asset cases are often complex, this Bitcoin case is a straight-up fraud: simple and old as time. We will continue to deploy every weapon in our arsenal to fight fraud in all our markets.”
According to the CFTC complaint, Orvida created a spreadsheet that displayed trading profits, except they were bogus. When an investor requested their funds, Orvida cooked up excuses and did not return the funds.
The complaint states:
“As a result of Orvidas’s conduct, pool participants suffered net losses (pool participant contributions minus substantiated amounts returned to pool participants) of $2,033,501.10.”
Orvidas is expected to pay the restitution within 30 days of the order.
