SEC files civil lawsuit against Forage

The US Securities and Exchange Commission (SEC) has filed a civil complaint against 11 individuals who have been charged with participating in a fraudulent cryptocurrency pyramid scheme that cost investors more than $300m.

The investment opportunity they promoted goes by the name of “Forsage” and has been described as a Ponzi scheme by SEC.

Forsage made it possible for millions of retail investors to use Ethereum, Tron and Binance blockchains via smart contracts to access it.

To generate profitability, investors needed to bring others into the scheme so they could earn fees off them.

SEC has described this operation as a “textbook pyramid and Ponzi scheme”. The company aggressively promoted its smart contracts and used ample advertisement resources to get more people involved.

The company was not selling any actual, consumable product, the SEC complaint read. To make money, all investors had to do was bring more people onboard to generate fees off from them.

“As the complaint alleges, Forsage is a fraudulent pyramid scheme launched on a massive scale and aggressively marketed to investors”, said SEC crypto assets and cyber unit chief Carolyn Welshhans.

SEC has gone both after the founders, and the US-based promoters who were pushing Forsage on their social media platforms – a good reminder that when the penny drops everyone who has facilitated a cryptocurrency fraud will be prosecuted.

Despite evidence surfacing throughout the years, and enforcement action following from multiple countries, the company’s founders denied any wrongdoing.

However, considering the latest civil complaint, at least two of the defendants have agreed to settle the charges, although court approval is still needed.

If you want to use your cryptocurrency smartly, just visit websites such as 1xBit, FortuneJack or to have a bit of fun and stay away from fraudulent schemes.


Updated: 08/02/2022 — 18:00