The U.S. Commodity Futures Trading Commission (CFTC) has taken legal action against Sam Ikkurty, Ravishankar Avadhanam, and Jafia LLC for civil breaches of the Commodity Exchange Act (CEA), specifically related to their involvement in cryptocurrency investments. On Monday, the court granted the CFTC’s request for summary judgment, concluding that the defendants had misrepresented the performance of their cryptocurrency funds. They were found to have operated a scheme resembling a Ponzi scheme by redistributing participants’ funds instead of distributing actual profits, and also made false claims regarding their investment expertise and methodologies.
Ikkurty raised millions of dollars under the guise of managing “crypto hedge funds,” despite not being properly registered as Commodity Pool Operators (CPOs), and was involved in fraudulent activities. As a result of the court’s decision, the defendants are required to pay restitution totaling $83,757,249 and disgorgement amounting to $36,967,285. These financial penalties also extend to relief defendants involved in the case.
