Washington, D.C. – Commodity Futures Trading Commission (CFTC) investigators have brought charges against Jacob Orvidas for allegedly defrauding investors in a leveraged bitcoin scheme. The CFTC issued an order simultaneously filing and settling charges against Orvidas on Friday, September 8, 2023.
The order details how Orvidas fraudulently solicited at least four individuals to participate in a commodity pool intended for leveraged bitcoin trading between October 2017 and July 2020. According to the CFTC, Orvidas misrepresented his trading expertise and falsely promised participants substantial profits, claiming the venture was “like printing money.” Investors contributed over $2 million based on these claims.
However, Orvidas allegedly lost nearly all of the invested funds through trading. Instead of disclosing these losses, he is accused of providing fabricated spreadsheets showing fictitious profits and inflated account balances. He further allegedly lied to participants regarding their ability to withdraw funds and principal. As a result, investors suffered losses exceeding $2 million.
In addition to the fraudulent solicitation, the CFTC found that Orvidas failed to register as a commodity pool operator, a violation of the Commodity Exchange Act. The settlement requires Orvidas to pay over $2 million in restitution to the defrauded investors and a $500,000 civil monetary penalty.
The CFTC order also imposes a 10-year ban on Orvidas’ ability to register with the CFTC and engage in trading. “Protecting ordinary people has always been at the heart of the CFTC’s digital-asset enforcement program,” stated Ian McGinley, Director of Enforcement. “This bitcoin case is a straight-up fraud… We will continue to deploy every weapon in our arsenal to fight fraud in all our markets.”
The CFTC acknowledged the assistance of the Securities and Exchange Commission in the investigation. The case was led by Anthony Biagioli, Stephen Turley, Jeff Le Riche, Christopher Reed, and Charles Marvine of the Division of Enforcement.
Source: CFTC.gov
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