Federal Judge Orders Debiex to Pay Over $2.5 Million in Romance Scam Ruling
Arizona Court Rules Against Crypto Platform
In a recent ruling, a federal judge in Arizona has ordered Debiex, a crypto platform that has been identified as a romance scam, to pay approximately $2.5 million. This decision comes after the U.S. Commodity Futures Trading Commission (CFTC) filed a lawsuit against Debiex, claiming that it operated a deceptive scheme that targeted unsuspecting individuals on social media.
Background of the Case
On March 13, Judge Douglas Rayes granted the CFTCâs motion for summary judgment, confirming that Debiex had failed to respond adequately to the allegations brought against it. The court found that Debiex had misled customers by falsely presenting itself as a legitimate trading platform, ultimately stealing around $2.3 million from its victims. In addition to the reimbursement of stolen funds, Judge Rayes imposed a civil penalty of nearly $221,500 against the company.
The CFTCâs lawsuit, which was initiated in January 2024, described Debiex as a perpetrator of a âpig butcheringâ scam. This type of con involves scammers developing romantic relationships with potential victims online to build trust before encouraging them to invest in fraudulent schemes. According to the CFTC, Debiex successfully deceived at least five individuals who collectively deposited large sums of money into accounts associated with the platform.
Deceptive Practices Identified
The courtâs ruling highlighted the predatory practices employed by Debiex staff, who allegedly posed as female traders on social media. They engaged customers through continuous messaging and shared manipulated images, presenting themselves as âhighly successful digital asset commodities traders.â The CFTC noted that, once customers set up accounts and sent their cryptocurrency to Debiex, the platform provided them with fictitious information regarding their account balances, trading positions, and supposed profits.
The scheme was structured to create a false sense of security for victims, who were misled into believing that their investments were yielding returns. However, according to the CFTC, the reality was that customer funds were immediately funneled into various digital wallets as an attempt to obscure their ultimate destination.
Additional Findings Against ZhÄng ChĂ©ng YĂĄng
In conjunction with the ruling against Debiex, Judge Rayes also issued a default judgment against ZhÄng ChĂ©ng YĂĄng, an individual identified as a âmoney muleâ for the platform. Evidence presented by the CFTC indicated that ZhÄng controlled a crypto wallet on the OKX exchange, which was used to receive funds from victims without any legitimate authorization. The court found that this wallet contained approximately $119,500 in digital assets, including Tether and Ether, which Judge Rayes ordered to be transferred to an unnamed victim.
Conclusion
The ruling against Debiex serves as a reminder of the ongoing risks associated with cryptocurrency investment platforms, particularly those that utilize deceptive tactics to lure investors. The CFTCâs actions reflect a commitment to protecting consumers in the evolving landscape of digital asset trading. As the cryptocurrency market continues to mature, regulatory bodies are likely to intensify their efforts to crack down on fraud and enhance investor protection.
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