SEC charges California citizen with $26 million Ponzi scheme

Posted 24 May, 2019

The financial market regulator Securities and Exchange Commission has reportedly launched a case against an individual from California citing illegal trading of securities and creation of Ponzi scheme.

According to the report unveiled by the authority yesterday, the California resident  Daniel Pacheco is charged with offering unregistered securities and fraud activities in the market, in particular, a pyramid scheme via two companies. He offered securities via Ipro Solutions LLC and Ipro Network LLC. Once the victims bought securities, they received so-called points which were believed to be converted into PRO Currency, the assets of the affiliate companies. Investors also were able to get additional points by bringing new members to the scheme.

"The SEC’s complaint, filed Wednesday, alleges that from January 2017 through March 2018, Pacheco conducted a fraudulent, unregistered offering of securities through two California-based companies he controls, IPro Solutions LLC and IPro Network LLC (collectively, “Ipro”)."

SEC stated in the document that Pacheco received about $26 million from these activities.

The SEC representative noted:

"He enticed investors by offering them the opportunity to speculate in cryptocurrency, when in fact he was simply operating a pyramid scheme.” 

It was reported that the funds were spent on real estate and other goods. Specifically, he purchased a house and a luxury car. 

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