TLDR
- The SEC and US prosecutors have charged Ramil Palafox with running a $200 million crypto and forex trading scheme that defrauded 90,000 investors
- Palafox allegedly misappropriated over $57 million through his company PGI Global between 2020-2021
- The scheme used multilevel marketing and false claims about AI-powered trading to lure investors with promises of guaranteed returns
- Palafox allegedly spent investor funds on luxury items including Lamborghinis, Ferraris, and designer goods
- This is the first crypto-related case under new SEC chair Paul Atkins, who was sworn in on April 22, 2025
In a major crackdown on alleged crypto fraud, the Securities and Exchange Commission (SEC) and federal prosecutors have charged Ramil Palafox with orchestrating a $200 million scheme that defrauded approximately 90,000 investors. Palafox, a dual citizen of the US and the Philippines, allegedly misappropriated over $57 million through his company PGI Global between January 2020 and October 2021.
The SEC filed charges on April 22, 2025, claiming Palafox lured investors with false promises of high returns from Bitcoin and foreign exchange trading. According to the complaint, Palafox marketed PGI Global as a legitimate crypto asset and forex trading company that guaranteed profits to those who purchased “membership” packages.
Investigators allege that instead of conducting actual trading activities, Palafox operated what the SEC described as a “Ponzi-like” scheme. The company reportedly used new investor funds to pay supposed returns to earlier investors until its eventual collapse in late 2021.
Lavish Lifestyle Funded by Investor Money
The charges detail how Palafox allegedly spent investor money on personal luxuries rather than legitimate trading operations. According to the SEC complaint, he used investor funds to purchase an array of high-end vehicles and other luxury items.
“Palafox bought himself and his family cars, watches, and homes using millions of dollars of investor funds,” said Scott Thompson, Associate Director of the SEC’s Philadelphia office.
If convicted, Palafox would forfeit over $1 million in cash and 17 vehicles. The seized vehicles include two Teslas, a Ferrari 458 Special, two Lamborghinis, and two Porsches.
The list of confiscated items extends beyond vehicles to include designer bags, wallets, shoes, jewelry, and watches. These assets are part of the property listed in the indictment that would be forfeited upon conviction.
Multilevel Marketing Tactics
The SEC alleges that Palafox employed multilevel marketing strategies to expand his operation. According to the complaint, he hosted extravagant events in Dubai and Las Vegas to recruit new members.
These new members were reportedly offered referral bonuses to bring others into the scheme. The company structure incentivized existing investors to recruit new participants, which helped spread the fraud further.
Laura D’Allaird, Chief of the SEC’s Cyber and Emerging Technologies Unit, stated that Palafox “used the guise of innovation” while making false claims about crypto expertise and an AI-powered auto-trading platform to mask “an international securities fraud.”
According to prosecutors, Palafox told investors that his traders could generate profits regardless of Bitcoin’s price movements. He allegedly claimed substantial returns were being generated through the company’s crypto exchanges.
However, the Justice Department claims that most investors’ money was never actually used to buy or trade Bitcoin. As a result, many investors lost some or all of their funds when the scheme collapsed.
The SEC’s filing indicates Palafox promised daily returns ranging from 0.5% to 3% from Bitcoin trading. He allegedly hid information about PGI’s true profitability, licenses, and business activities from investors.
The criminal indictment was filed under seal on March 13, with federal prosecutors charging Palafox with wire fraud, money laundering, and unlawful monetary transactions.
In its civil action, the SEC is seeking permanent injunctions to ban Palafox from future sales of securities and crypto assets. The agency also wants repayment of ill-gotten gains and civil penalties.
The case represents the first crypto-related enforcement action under new SEC chair Paul Atkins, who was sworn in on April 22, 2025. Atkins is generally viewed as more favorable toward the cryptocurrency industry compared to his predecessor.
The SEC had previously brought a case against Nova Labs in January, accusing it of selling unregistered securities through devices that mined the Helium token. That case was settled in April, resulting in the lawsuit being dismissed after a $200,000 civil penalty.
