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US Justice Department Charges Ex-CEO Over Cryptocurrency Fraud

source-logo  en.bitcoinsistemi.com 12 October 2023 22:14, UTC

Peter Kambolin, former CEO of investment firm Systematic Alpha Management LLC (SAM), has pleaded guilty to a “cherry-picking” fraud scheme.

The “cherry-picking” scheme has been described as a form of securities fraud. In this scheme, brokers or traders monitor how their trades perform throughout the day, keeping the best-performing securities for themselves or investors of their choice.

Kambolin, a 48-year-old US-Russian citizen, was accused of fraudulently appropriating profitable trades while causing losses to his investors. The scheme ran between January 2019 and November 2021. Kambolin misrepresented to clients that SAM implemented trading strategies focused on cryptocurrency futures contracts and currency futures contracts.

However, approximately half of Kambolin's transactions in each pool involved stock index futures contracts. This resulted in investors in the United States and abroad being defrauded and deprived of profitable transactions.

Acting Assistant Attorney General Nicole M. Argentieri of the Department of Justice's Criminal Division said this case demonstrates the Department of Justice's commitment to prosecuting financial advisors who put their own interests ahead of their clients.

Kambolin was convicted of conspiracy to commit commodities fraud and faces a maximum sentence of five years in prison. A sentencing date has not yet been set.

*This is not investment advice.