Ponzi Scheme Unveiled in Cryptocurrency
A staggering Ponzi scheme in the cryptocurrency space has been unveiled, involving $200 million in fraudulent activity that deceived nearly 90,000 investors globally with promises of exorbitant returns and extravagant spending by its orchestrator. On September 17, the U.S. Department of Justice (DOJ) revealed that Ramil Ventura Palafox, the 60-year-old founder of Praetorian Group International (PGI), confessed to conducting this elaborate scam, which prosecutors have characterized as a classic Ponzi structure.
Plea and Charges
Palafox has pleaded guilty to charges of wire fraud and money laundering, admitting that PGI misappropriated new investors’ funds to pay returns to earlier participants, all while guaranteeing daily profits of up to 3%. Investigations have unearthed the extensive nature of the fraud: between December 2019 and October 2021, 90,000 individuals worldwide invested over $201 million into PGI, which included more than $30 million in traditional currency and 8,198 bitcoins totaling around $171 million.
Investor Losses and Deceptive Practices
As a direct consequence of Palafox’s misconduct, the DOJ reported that investors faced losses amounting to at least $62.7 million. To instill trust among victims, Palafox created a deceptive website that falsely indicated increasing account balances, while diverting significant funds toward his personal luxuries.
Extravagant Spending
The extravagant acquisitions made by Palafox included 20 high-end vehicles worth approximately $3 million, along with luxury residences in Las Vegas and Los Angeles, in addition to lavish hotel penthouses. Investigative efforts also showcased his spending habits, as Palafox directed $3 million of investors’ funds toward luxury retail purchases, splurging on clothing, jewelry, and accessories from renowned brands like Louboutin, Gucci, and Cartier.
Future Sentencing
Furthermore, it was found that he transferred nearly $800,000 in cash to a family member along with 100 bitcoins valued at around $3.3 million at the time. Palafox is scheduled for sentencing on February 10, 2026, where he could face up to 40 years in prison and has consented to repay the full investor losses of $62.7 million, although the final decision on his sentence lies with a federal judge who will consider various legal guidelines.
