SEC Halts Pyramid Scheme
A pyramid scheme known as Mutual Wealth promisedreturns of 2% to 3% a week for new investors through a high-frequency trading strategy. The scheme was operated outside of the U.S. and promoted through social media.
Mutual Wealth falsely claimed to be “duly registered” with the SEC and solicited at least $300,000 from 150 investors through Facebook and Twitter. It encouraged investors to recruit other prospects “in exchange for a referral fee or commission.”The money was diverted to offshore bank accounts held by shell companies in Cyprus and Latvia.
Almost nothing Mutual Wealth represented to its investors was true: the Hong Kong headquarters did not exist; Mutual Wealth's sole shareholder and director, as with every person claiming to represent Mutual Wealth, was a fiction; the real operators of Mutual Wealth are using fictitious names, address and other information to further their fraud.
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