MoneyWatch August 1, 2022 / 3:22 PM / MoneyWatch Voyager Digital suspends crypto trading Voyager Digital suspends crypto trading activity 04:54 Eleven people who ran and promoted cryptocurrency firm Forsage are facing charges of operating a pyramid and Ponzi scheme that raised more than $300 million from millions of investors in the U.S. and elsewhere, according to the Securities and Exchange Commission. The Forsage executives posted videos that promised huge returns for investors, with one calling it "a powerful long-term source of passive income" and telling viewers, "Forsage means fast and furious." But securities regulators allege the service's founders weren't providing an investment strategy, but rather running a pyramid scheme, where investors made money by recruiting others. Also, earlier investors were paid through the money invested by newer customers, the hallmark of a classic Ponzi structure.  "Aggressively marketed to investors"The charges underscore the financial risks of a sector that has drawn a fair share of fraudsters and scammers, aside from the massive price plunges that cryptocurrencies have experienced this year. In the case of Forsage, the service was created in 2020 and targeted retail investors who wanted to enter into crypto transactions via so-called "smart contracts" that operated on the ethereum, tron and binance blockchains. In addition to the four founders, the SEC also charged three U.S.-based promoters hired by Forsage to tout the service as well as several members of the Crypto Crusaders, a promotional group for the service, the SEC said.  "As the complaint alleges, Forsage is a fraudulent pyramid scheme launched on a massive scale and aggressively marketed to investors," said Carolyn Welshhans, acting chief of the SEC's Crypto Assets and Cyber Unit, in a statement.The four founders are: Vladimir Okhotnikov, Jane Doe (known by her pseudonym Lola Ferrari), Mikhail Sergeev and Sergey Maslakov. Also charged were several Americans who were hired by Forsage to tout the service, such as one promoter who claimed she had invested $1,600 and earned more than $1 million in seven months, the complaint alleges. The four founders were last known to be living in Russia, the Republic of Georgia and Indonesia, the SEC said.  Thanks for reading CBS NEWS. Create your free account or log in for more features. Please enter email address to continue Please enter valid email address to continue
Forsage crypto executives charged with running $300 million Ponzi scheme.