CFTC Secures $128 Million Judgment Against Crypto and Forex Fraudsters

This week, the Commodity Futures Trading Commission (CFTC) announced a USD 128 million judgment against two individuals, Ryan Mitchell Pope and Daniel Samuel Bishop, and their associated entities EmpiresX for operating a fraudulent forex and cryptocurrency investment scheme that defrauded more than 12,500 victims. The enforcement action highlights the role of financial crime investigations in exposing fraud, tracing illicit funds, and protecting investors in digital asset markets.

From 2019 to 2020, Pope, Bishop, and their companies, Archer Digital, LLC, and EminiFX, Inc., lured investors into what they claimed were high-yield, risk-free forex and crypto trading programs. The defendants promised consistent profits using proprietary trading technology, but instead, they operated a classic Ponzi scheme, misappropriating millions of dollars for personal use and falsifying records to conceal losses. Investigators revealed that the defendants fabricated trading returns, manipulated investor dashboards, and used new investor funds to pay fictitious "returns" to earlier participants. Instead of executing legitimate trades, the defendants funneled investor funds into personal bank accounts, real estate purchases, and luxury goods—a pattern that closely mirrors previous large-scale crypto fraud cases.

Using forensic blockchain intelligence, investigators traced misappropriated funds across multiple cryptocurrency exchanges, forex platforms, and personal accounts. Authorities identified that the defendants used digital assets to obscure the movement of investor funds, attempting to evade detection. A portion of the stolen assets was converted to USDT and Bitcoin, then routed through mixing services and high-risk exchanges. Investigators linked crypto addresses associated with the scheme to previous fraudulent operations, providing a roadmap for asset recovery.

As a result of the investigation, the CFTC obtained a court order requiring Pope, Bishop, and their entities to pay USD 128 million in restitution and penalties. The court also banned both defendants from ever trading in commodity markets again. Authorities moved to seize crypto assets and bank accounts linked to the fraudulent scheme, and further investigations are underway to identify additional assets and potential co-conspirators.

This case underscores the importance of financial crime enforcement in the digital asset space. Public-private collaboration between regulators, law enforcement, and financial institutions plays a critical role in tracing illicit funds, dismantling fraudulent operations, and holding bad actors accountable. 

Last week, Acting CFTC Chair Caroline Pham announced a significant restructuring of the Division of Enforcement, introducing two new task forces: one dedicated to combating complex fraud and manipulation, and another focused on protecting retail investors. Pham emphasized that this reorganization aims to "stop regulation by enforcement" and is "more efficient," allowing the CFTC to "bring more actions to pursue fraudsters and other bad actors, and not punish good citizens." This shift underscores the CFTC’s commitment to addressing clear cases of fraud in line with its mission to safeguard commodities markets. As digital assets increasingly play a role in fraudulent schemes, real-time financial intelligence is more crucial than ever for maintaining market integrity and protecting investors.