Denis Jalis, a South African who resides in the US has been charged with fraud in the Maryland District Court for allegedly scamming over 1,000 investors of $28 million.
Reportedly, he targeted African immigrants. Jalis promised them that they would get returns on his Bitcoin and foreign currency investment pool.
Jali alongside two other accomplices to the crime were charged by the U.S. Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC).
Arley Ray Johnson and John Frimpong, Jalis accomplices were docked also for fraudulently soliciting money from investors who contributed $28 million to Million LLC, Smart Partners LLC, and Access to Assets LLC
According to a statement by authorities that charged the suspects to court, they asked participants to trade n Bitcoin and Forex via a pooled trading account which Jai, the ring leader controlled. The pool was on for three years (2017-2020) garnering well over 1,000 investors.
Victims were also lured to signing “secure contracts” promising guaranteed returns of about 30 percent monthly with the promise that their seed capital would be returned at the end of the pool participation term.
The accomplices also deceived investors selling the South African (Jali) the ring leader as a brilliant career trader who had made 1,700 percent in returns in a previous investment fund.
Jali also in a promotional video claimed he had returned over 400 percent in gains within six weeks. He also said his wife has never worked a day in her life.
How the South African and his accomplices played the scam
According to the charge slammed against them, investments they accrued were not staked in Bitcoin or Forex, rather it was converted to a Ponzi where $18 million was paid to selected investors making it look like a profitable business.
The remaining $7 million was used by the South African and his accomplices to buy luxury cars and fund other expensive lifestyles.
In the charge against the suspects, SEC alongside CFTC seeks full restitution to the defrauded investors disgorgement of ill-gotten gains, civil monetary penalties, and permanent trading bans for the three.
In 2019 after the South African (Jai) was indicated by the US attorney for District of Maryland, he fled the US. He was later arrested in South Africa on federal charges of conspiracy, wire fraud, securities fraud, and money laundering.