In the first move under newly appointed Chairman Paul Atkins, the U.S. Securities and Exchange Commission (SEC) has officially sued Ramil Palafox – CEO of PGI Global – accusing him of running a large-scale Ponzi scheme worth up to $198 million. The story reveals many shocking details: from promises of 200% profits, fake trading platforms, to the lavish lifestyle of the head.
PGI Global and the 'membership package' offering 200% profit
According to the indictment filed in the Eastern District Court of Virginia, Palafox sold 'membership packages' from January 2020 to October 2021, promising profits of up to 200% from an AI-driven cryptocurrency and forex trading platform.
In fact, according to the SEC, that platform does not exist. PGI Global hardly conducted any trading activity for investors. All promises were fakes to lure in new funds and sustain a Ponzi scheme.
Accused of misusing tens of millions of dollars for a lavish lifestyle
The SEC confirms that more than $57 million, including fiat money and Bitcoin, has been misappropriated by Palafox for personal use and 'benefits for close relatives.'
Details in the lawsuit show:
A $1.7 million villa in Las Vegas.
Many expensive Lamborghinis.
A Cartier jewelry collection worth $1.18 million.
A series of luxury goods from Louis Vuitton, Hermès...
Additionally, the SEC also listed four related individuals – including Palafox's wife, mother, and brother-in-law – as those who received money and assets from illegal activities, such as:
Pay off a $320,000 mortgage.
A Range Rover.
High-end branded goods.
The 'AI crypto trading' scheme – a sophisticated trick to deceive investors
PGI Global is registered under the name PGI Global UK Ltd and previously operated in the UK before being shut down by the UK Supreme Court in September 2022, accused of running a fraudulent investment scheme.
From July 2020 to February 2021, PGI attracted over $815,000 from investors in the UK, but when promised profits did not materialize, users were unable to withdraw their funds.
According to SEC records, Palafox not only faked trading activity by executing circular transactions to create the illusion of real trading but also tampered with the dashboard displaying fake profit data to retain investors.
The SEC takes a tough stance – marking the beginning under Chairman Paul Atkins
This lawsuit is the first crypto-related action by the SEC under the leadership of Chairman Paul Atkins – who took office just one day prior.
In a press release, Laura D’Allaird, head of the SEC's Network Unit, stated:
"False claims about expertise in the crypto industry and AI trading platforms are merely a facade for an international securities fraud."
SEC currently requests the court:
Impose a permanent ban on Palafox from participating in any fundraising activities related to crypto or multi-level marketing (MLM) schemes.
Order the return of all misappropriated funds (disgorgement).
Appropriate civil penalties.
In parallel, federal prosecutors have also criminally charged Palafox in a related criminal case in Virginia. The official website of PGI Global has been seized by the Department of Justice and the U.S. Department of Treasury after the court issued an order.
In relation to the crypto market and Binance users
This incident once again highlights the potential dangers of disguised crypto projects using AI tricks, huge profits, and multi-level marketing schemes.
To users on Binance, this is a clear warning:
Always thoroughly check project information before investing.
Do not trust promises of 'guaranteed profits' or 'automated trading with AI' without clear and licensed evidence.
Binance only supports projects that have been transparently listed, with strict testing standards and legal compliance.
Conclusion and risk warning
The PGI Global lawsuit is a classic example of the risks in crypto investing when investors place too much trust in unverified promises. While blockchain and AI technology offer great potential, if exploited to disguise fraudulent schemes, the damage is not just financial but also affects overall trust in the market.
Risk warning: Investing in digital assets and the crypto market always carries high risks, including the risk of losing all capital. This article is not an investment recommendation. Users should conduct their own thorough research and consideration before making financial decisions.