The U.S Commodities Futures Trading Commision (CFTC) brought a fraud case to court and established a precedent in the process of the CFTC having jurisdiction over cryptocurrencies. The New York Eastern District Court ruled in the favour of CFTC and fined the incumbent $1.1 million in fines and restitution.

The defendant against whom the case was charged included Patrick K. McDonnell, Cabbage Tech and Coin Drop Markets. The decision was ruled on August 23rd, 2018, the details of which are included in a 139-page long Memorandum. Till this ruling was passed, many assumed that the Securities and Exchange Commission (SEC) would be the only government body regulating the cryptocurrency space within the United States. It was in the interest of the CFTC to counter this impression and to establish that it indeed has jurisdiction within the crypto space.

The CFTC alleged back in first of 2017 that Patrick K. McDonnell and Cabbage Tech fraudulently lured victims into purchasing and trading under their guidance and advice. McDonnell, who supposedly was a Chief Technology Officer, had falsely claimed that Cabbage Tech had its company offices in locations such as Wall Street along with other blatant lies about the companies infrastructure.

According to the CFTC, Patrick K. McDonnell worked from his home and his ‘company’ consisted no one else apart from him. Later in 2017, the company’s website claimed that it had been hacked and announced that it would be suspending any and all activity. Soon after the announcement, all presence of the company was erased from the internet, including its presence on social media, This led many of the companies customers to feel as if they had been duped.

By 2018, the CFTC had brought charges against the defendant and alleged that the company led by McDonnell was. “a deceptive and fraudulent virtual currency scheme for purported virtual currency trading advice; for virtual currency purchases and trading misappropriated [investor] funds.”

Abhimanyu Kumar

Abhimanyu holds an engineering degree from a reputed college. Pragmatic! Skilled in Operations, Project Management, Product Engineering & Management, Entrepreneurship, Business Management, Negotiation, Event Planning and Social Services. He likes exploring chills & thrills in the field of emerging technologies like Blockchain, AI, Space Technology, Renewable Energy, Virtual Reality, Agri-tech/Bio Sciences or Travel & Tourism and Education. He always makes an effort to learn something new everyday.

Abhimanyu Kumar

Abhimanyu holds an engineering degree from a reputed college. Pragmatic! Skilled in Operations, Project Management, Product Engineering & Management, Entrepreneurship, Business Management, Negotiation, Event Planning and Social Services. He likes exploring chills & thrills in the field of emerging technologies like Blockchain, AI, Space Technology, Renewable Energy, Virtual Reality, Agri-tech/Bio Sciences or Travel & Tourism and Education. He always makes an effort to learn something new everyday.