Latino residents targeted in Crypto ponzi scheme
A nationwide fraud scheme targeting Latino investors had claimed at least 30 local victims, according to a warning issued by City Hall this week.
Several households have contacted officials claiming they have been victims of a crypto-Ponzi scheme run by agents of CryptoFX, LLC., a business at the center of a federal enforcement action in Texas.
According to the Securities and Exchange Commission, regulators filed an emergency order to stop an ongoing fraudulent and unregistered crypto asset offering targeting Latino investors, run by defendants Mauricio Chavez and Giorgio Benvenuto through CryptoFX, LLC in September.
Officials claim that Chavez began holding paid classes with the stated purpose of educating and empowering the Latino community to build wealth through crypto-asset trading. Crypto assets include digital currencies such as Bitcoin or NFT art.
However, the SEC said Chavez had no background, education or training in investments or crypto-assets.
“According to the complaint, the seminars were merely conduits to solicit investors to give their money to CryptoFX, which Chavez would then allegedly use to operate cryptoassets and currency trading,” the SEC said in a statement.
The SEC also alleges that he provided investors with false documents that, among other things, grossly overstated his crypto experience and guaranteed that investors would bear no losses. The defendants ultimately raised over $12 million from more than 5,000 investors.
“SEC Alleges Chavez Actually Operated a Ponzi Scheme; instead of using investor funds for crypto trading, Chavez used more than 90% of investor funds to pay false returns to investors, support his lifestyle, and buy and develop real estate that he and Benvenuto controlled, the statement said. “In turn, Benvenuto allegedly solicited a large investor into the scheme and directed investor funds to himself and a company he and Chavez owned, CBT Group, LLC. In total, the SEC alleges, Chavez and Benvenuto made approximately $2.7 million in Ponzi- payments while diverting nearly $8 million to their own use, including nearly $1.5 million that Chavez spent on cars, credit card payments, jewelry, adult entertainment and a house in his wife’s name.”
The local victims approached city officials and requested an official warning from City Hall.
“Recent information indicates that representatives of CryptoFX continue to communicate with local residents, primarily through the WhatsApp chat service, and are actively soliciting funds,” the city said in its warning. “The city urges residents who want to put money into crypto-related investments to do their research and exercise extreme caution.”
If asked to give money to CryptoFX representatives or its affiliates, citizens should contact officials.
Potential victims can visit for information on filing a fraud claim.
Additional resources
The California Department of Financial Protection and Innovation ( DFPI is a state agency that provides consumer protection in financial transactions and regulates financial services, products and professionals. You can file a complaint with DFPI at
Haven Neighborhood Services ( Haven is a community-based organization that offers free financial counseling for clients. Haven staff can help victims file claims with the court-appointed receiver in the CryptoFX SEC case. Diana Arciniega: [email protected] (213 ) 375-4663.
The Santa Monica Police Department, in partnership with Familias Latinas Unidas (“FLU”), is planning an outreach event addressing fraud prevention, in Spanish and English. The program will address common financial fraud, financial fraud detection and prevention, and additional tools for consumers. To learn more about this event, please contact [email protected].
