The Commodity Futures Trading Commission (CFTC) has informed the New York Eastern District Court of an agreement on an order that would resolve the lawsuit against crypto fraudster Rashawn Russell.
The proposed Consent Order was filed with the Court on January 14, 2025. The Consent Order would resolve the CFTC’s claims in this action.
On May 30, 2024, Russell was sentenced to 41 months in custody and three years of supervised release on one count of wire fraud and one count of access device fraud and was ordered to pay criminal restitution of $1,522,494.95. The defendant previously pleaded guilty to these charges. Defendant is currently incarcerated at FCI Lewisburg.
The proposed order envisages a permanent injunction and restitution. The amount of restitution in the CFTC lawsuit is set to be covered by the sum paid in the parallel criminal action.
The CFTC filed its complaint against Russell on April 11, 2023. The CFTC’s complaint charges Russell with fraudulently soliciting retail investors to invest in a digital asset trading fund and with misappropriating at least $1 million in investor assets.
The CFTC complaint alleges that, from approximately November 2020 through July 2022, Russell solicited retail investors to contribute bitcoin, ether, and fiat currency to invest in his purported proprietary digital assets trading fund. Russell guaranteed no losses to investors and, in some instances, a minimum 25 percent return on investment.
As alleged in the complaint, Russell intentionally and/or recklessly made false and misleading statements regarding the fund’s structure, size, and performance; traded little, if any, of the money and digital assets as represented; and, falsely promised to pay withdrawal requests, including falsely promising that he would pay investors in the stablecoin USDC.
At least $1 million in investor assets are alleged to have been misappropriated by Russell through his fraudulent scheme and used, among other things, to pay personal expenses, entities associated with gambling activities, and Ponzi-like payments to current investors.
