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The US Department of Justice (US Department of Justice) has obtained a 20-year prison sentence against the founder of a massive cryptocurrency investment scheme.
According to prosecutors, this scheme defrauded more than 90,000 investors worldwide of more than $200 million.
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The Justice Department exposes and dismantles a $200 million Bitcoin ponzi while its founder is sentenced to 20 years in prison.
in statement Released Thursday, the Department of Justice confirmed that Ramil Ventura Palafox, 61, was sentenced after pleading guilty to one count of fraud. And bathroom money .
Palafox was the founder, president and CEO of Praetorian Group International (PGI), a multi-level marketing company that claims to generate huge returns through Bitcoin trading and cryptocurrency strategies.
According to court documents, PGI operated from December 2019 to October 2021, collecting more than $201 million from investors around the world. The company has promised daily returns ranging from 0.5% to 3%, traded as dividends from Advanced Bitcoin arbitrage and sophisticated trading activities .
In fact, the investigators found that PGI was not trading at the volume required to achieve such returns. Instead, work Like a classic Ponzi schemewhere he used money from new investors to pay the salaries of previous participants.
At least $30.2 million was invested in fiat currency, as well as 8,198 bitcoin worth about $171.5 million at the time of the investment, authorities said.
Confirmed losses amount to at least $62.7 million, although plaintiffs indicate that the total financial damage could be much higher.
Luxury lifestyle and artificial profits: how Palafox hid the collapse behind a luxury facade
To maintain the illusion of profitability, Palafox allegedly created and operated an online investor portal that displayed fake account balances.
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Between 2020 and 2021, the platform still falsified the investment performance. It falsely showed steady earnings and boosted investor confidence even as the plan collapsed behind the scenes.
Court documents show how Palafox diverted large sums of investor money to finance a lavish personal life.
According to prosecutors, he spent about $3 million on 20 luxury cars. He also spent about $329,000 on a penthouse in a luxury hotel chain and purchased four residential properties in Las Vegas and Los Angeles worth more than $6 million.
Additional spending included about $3 million in designer clothing, jewelry, watches and home furnishings from luxury stores.
Prosecutors also alleged that Palafox transferred at least $800,000 in fiat currency and 100 bitcoins — then worth nearly $3.3 million — to a family member.
The program began to collapse in mid-2021 after the PGI website stopped working and withdrawal requests increased. in spite resignation Palafox was removed from the CEO position in September 2021. Authorities say he initially retained control of the company’s accounts.
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Prosecutors described the case as one of the most important Ponzi schemes in recent years. The sentence represents a decisive conclusion to a scheme that developed on the inflated profits of cryptocurrency and global recruitment networks.
Parallels with FTX: How PGI reversed a larger cryptocurrency collapse
Despite the difference in size and complexity, this condition is similar in many respects I would have FTX and associated infections. Both profited from the cryptocurrency boom, promising investors huge and unrealistic returns:
- Palafox with daily earnings in Bitcoin of 0.5-3%,
- FTX through high yield exchange products associated with Alameda Research.
Investors’ money was used for personal luxury spending:
- Palafox for luxury cars, real estate and designer goods
- SBF on Alameda’s risky bets, real estate and political donations.
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Both schemes used deceptive tactics to maintain investor confidence:
- The IGP with the dummy gate shows continuous gains
- FTX with hidden liabilities and overvalued valuations.
PGI defrauded more than 90,000 investors with confirmed losses exceeding $62.7 million, while FTX affected millions and billions in lost funds.
Federal prosecutions followed, with Palafox sentenced to 20 years in prison in February 2026. SBF was sentenced to 25 years in prison In 2024.
All of these things highlight a trend among bad actors in the cryptocurrency space, and also reveal the Department of Justice’s ongoing campaign against cryptocurrency fraud.
