CFTC orders Voyager co-founder to pay $750K
The post CFTC orders Voyager co-founder to pay $750K appeared on BitcoinEthereumNews.com. The Commodity Futures Trading Commission (CFTC) won a federal court order that requires Voyager Digital co-founder and former CEO Stephen Ehrlich to pay $750,000, which will go back to customers hurt by Voyager’s collapse. The CFTC announced the settlement in a statement and said the $750,000 will be paid through Voyager’s bankruptcy process. The order also bans Ehrlich from registering with the CFTC or participating in commodity trading for three years. CFTC says Ehrlich misled Voyager customers The CFTC had sued Stephen Ehrlich in October 2023, asserting that he and his company had built a business model that promised customers safety while trading but exposed them to extreme risks. Voyager became a digital asset platform for people to trade and store their cryptocurrency, but the CFTC argued that the company’s operations were reckless and misleading. Ehrlich misled investors by calling Voyager a “safe haven” for digital assets and comparing the platform to regulated financial institutions like banks. His comments gave people hope and a sense of peace, thinking the company would treat their money with the same care and oversight as those established institutions. But in reality, the company functioned without safeguards and never tried to protect its customers as promised. Voyager also promised traders big profits of as much as 12% on different crypto deposits. These numbers were outstanding because banks and bonds only offered a fraction of it, so it convinced thousands to move their savings onto the platform. However, the CFTC said these returns were only possible because Voyager was involved in risky activity. The regulator claimed Voyager loaned billions of dollars in customer assets to third-party borrowers with high credit and market risk levels. However, unlike banks that require collateral and strict checks, the company had limited protections that left its customers exposed if the borrowers…
The post CFTC orders Voyager co-founder to pay $750K appeared on BitcoinEthereumNews.com.
The Commodity Futures Trading Commission (CFTC) won a federal court order that requires Voyager Digital co-founder and former CEO Stephen Ehrlich to pay $750,000, which will go back to customers hurt by Voyager’s collapse. The CFTC announced the settlement in a statement and said the $750,000 will be paid through Voyager’s bankruptcy process. The order also bans Ehrlich from registering with the CFTC or participating in commodity trading for three years. CFTC says Ehrlich misled Voyager customers The CFTC had sued Stephen Ehrlich in October 2023, asserting that he and his company had built a business model that promised customers safety while trading but exposed them to extreme risks. Voyager became a digital asset platform for people to trade and store their cryptocurrency, but the CFTC argued that the company’s operations were reckless and misleading. Ehrlich misled investors by calling Voyager a “safe haven” for digital assets and comparing the platform to regulated financial institutions like banks. His comments gave people hope and a sense of peace, thinking the company would treat their money with the same care and oversight as those established institutions. But in reality, the company functioned without safeguards and never tried to protect its customers as promised. Voyager also promised traders big profits of as much as 12% on different crypto deposits. These numbers were outstanding because banks and bonds only offered a fraction of it, so it convinced thousands to move their savings onto the platform. However, the CFTC said these returns were only possible because Voyager was involved in risky activity. The regulator claimed Voyager loaned billions of dollars in customer assets to third-party borrowers with high credit and market risk levels. However, unlike banks that require collateral and strict checks, the company had limited protections that left its customers exposed if the borrowers…
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