CFTC case against Digitex futures exchange and CEO results in $16M court order

Turner Wright5 hours agoCFTC case against Digitex futures exchange and CEO results in $16M court orderThe commission filed charges against Digitex and CEO Adam Todd in September 2022 for alleged price manipulation and failure to register.225 Total views5 Total sharesListen to article 0:00NewsJoin us on social networksA United States federal court has ordered Digitex CEO Adam Todd to pay roughly $16 million in disgorgement and penalties related to a Commodity Futures Trading Commission (CFTC) case.

In a June 12 announcement, the CFTC said a judge in the U.S. District Court for the Southern District of Florida issued a default judgment against Todd and Digitex LLC, Digitex Limited, Digitex Software Limited and Blockster Holdings Limited Corporation for failure to register with the CFTC and manipulating the price of the DGTX token. As part of the judgment, the CEO and four companies under his control are banned from “trading in any CFTC-regulated markets” and required to pay $3,912,220 in disgorgement as well as a $11,736,660 civil monetary penalty.

“Regardless of the technology used, the CFTC will aggressively use its well-established authority to ensure entities are lawfully registered and to address the manipulation of commodities in interstate commerce,” said CFTC enforcement director Ian McGinley.Federal Court Orders Digital Asset Derivatives Platform and Florida Resident to Pay More than $15 Million for Multiple Violations of the Commodity Exchange Act. Learn more: https://t.co/AprX50QcGf— CFTC (@CFTC) July 12, 2023

According to McGinley, Todd allegedly pumped the price of DGTX using a computerized bot, which in 2020 he deployed on third-party exchanges to buy more of the token than it sold. The commission filed charges against Todd and Digitex in September 2022. The $16 million order or additional financial penalties may not necessarily result in repayment to Digitex users.

Related:CFTC commissioner says proposal to reassess risk management could consider crypto

Along with the U.S. Securities and Exchange Commission, the CFTC is currently involved in several civil suits with crypto firms and their executives over failure to comply with regulatory guidelines. These cases include allegations against crypto exchange Binance and civil charges for former FTX CEO Sam Bankman-Fried.

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