SEC charges CEO with nearly $200m crypto fraud scheme

The Securities and Exchange Commission accused PGI Global’s CEO of orchestrating an international scheme that raised $198 million under false crypto exchange claims.

The Securities and Exchange Commission has charged Ramil Palafox, CEO of PGI Global, with orchestrating a $198 million international fraud scheme tied to crypto and forex trading, alleging he misused over $57 million of investor funds for luxury cars, designer goods, and personal expenses.

According to the SEC, PGI Global claimed to be a crypto asset and foreign exchange trading company. From January 2020 through October 2021, Palafox sold “membership” packages that he said would bring investors high returns. These packages were linked to PGI Global’s “supposed crypto asset and foreign exchange trading and offered members multi-level-marketing-like referral incentives to encourage them to recruit new investors,” the SEC said.

The financial watchdog claims Palafox attracted investors with the “allure of guaranteed profits” from crypto and foreign exchange trading, but instead of trading, Palafox bought himself and his family cars, watches, and homes using millions of dollars of investor funds.

“Palafox used the guise of innovation to lure investors into lining his pockets with millions of dollars while leaving many victims empty-handed. In reality, his false claims of crypto industry expertise and a supposed AI-powered auto-trading platform were just masking an international securities fraud.”

Laura D’Allaird, chief of the Commission’s new cyber and emerging technologies unit

The SEC filed its complaint in the U.S. District Court for the Eastern District of Virginia. It seeks permanent injunctions, penalties, and the return of ill-gotten gains. Palafox also faces criminal charges in a separate case from the U.S. Attorney’s Office for the Eastern District of Virginia.