11 Charged in Forsage cryptocurrency ponzi scheme  

11 Charged in Forsage cryptocurrency ponzi scheme  

September 4, 2022 Off By Mags Smith

The SEC has charged 11 people for their part in an alleged cryptocurency pyramid scheme that raised over $300,000 from millions of investors around the globe. 

The arrests stemmed from a complaint filed against the Forsage platform. Forsage claimed to be a decentralized blockchain, specialising in smart contracts, allowing investors to transact on the Ethereum (ETH), Tron (TRX), and BNB Smart Chain blockchains. 

Since launching in 2020, Forsage has been served with several cease-and-desist orders from various regulators. These include the Securities and Exchange Commission of the Philippines and the Montana Commissioner of Securities and Insurance, both ordering them to stop operations. 

According to the SEC, Forsage allowed investors to earn profits by bringing others into the operation for over 2 years. Which according to the SEC made Forsage a “textbook pyramid and Ponzi scheme,” which did not sell “any actual, consumable product,” and that “the primary way for investors to make money from Forsage was to recruit others into the scheme.” 

Carolyn Welshhans, acting chief of the SEC’s Crypto Assets and Cyber Unit, said that As the complaint alleges, Forsage is a fraudulent pyramid scheme launched on a massive scale and aggressively marketed to investors, Fraudsters cannot circumvent the federal securities laws by focusing their schemes on smart contracts and blockchains.” 

Those charged include: 

  • The company’s four founders, whose whereabouts are currently unknown. 
  • Three US-based promoters 
  • Several members of the Crypto Crusaders, who were the largest promotional group for the scheme.