CFTC sues Cash FX and four others over an alleged $950 million pool scheme
Serguey Asael Shinder2 min readThe US Commodity Futures Trading Commission has announced that it filed a complaint in the US District Court for the Middle District of Florida against Cash FX Group S.A. and its chief executive, Huascar Jose Lopez Castillo, of Brazil; The Conversion Pros, Inc. and its chief executive, Ronald Pope, of Oregon; and Justin Halladay, of Florida. The allegations have not been tested in court.
According to the complaint, the defendants ran a multilevel marketing Ponzi scheme that took more than $950 million from the public, including US residents, for what was presented as a commodity pool trading retail foreign currency contracts. Participants were told the money was traded by expert traders, proprietary algorithms and artificial intelligence, and were promised returns of up to 15% a week. The CFTC alleges that Cash FX did little forex trading, misappropriated nearly all participant funds, paid "profits" to existing participants out of new contributions, paid millions to each defendant, and issued false account statements to keep the scheme going. It puts participant losses at no less than $406 million.
The agency is seeking restitution, disgorgement, civil monetary penalties, trading and registration bans and a permanent injunction. Its enforcement director, David I. Miller, described the case as part of the division's renewed focus on protecting the public from fraud and manipulation.
What it means
The case lands on coinbrief because the reporting around it links the scheme to crypto payments, but the CFTC's own release frames it as a forex pool fraud, and that framing is the useful one. The legal hook is the commodity pool: once money is pooled to trade forex contracts for the public, the Commodity Exchange Act applies regardless of how participants paid in.
The allegations follow a familiar pattern, and it is worth naming because the vocabulary keeps changing while the structure does not. A fixed, high weekly return - here up to 15% - attributed to an opaque edge, now described as algorithms and AI; recruitment rewards through a multilevel structure; and statements showing profits that the underlying activity could not generate. Any one of those is a warning sign; all three together are the definition of the scheme regulators have been prosecuting for decades. The outcome now depends on the court.