Court Directs EminiFX Founder to Return $228 Million

A federal judge in New York has ordered Eddy Alexandre, the founder of the defunct crypto platform EminiFX, to pay over $228 million in restitution after determining that the company operated as a Ponzi scheme, defrauding tens of thousands of investors.

The US Commodity Futures Trading Commission (CFTC) won a summary judgment against Alexandre and EminiFX, with US District Judge Valerie Caproni finding them jointly liable for more than $228 million in restitution and an additional $15 million in disgorgement, according to a court filing made on Tuesday.

“Defendants Alexandre and EminiFX are jointly and severally liable to pay restitution in the total amount of $228,576,962,” the court found. “Defendant Alexandre is liable to pay disgorgement in the amount of $15,049,500.”

This ruling follows more than three years after Alexandre faced initial charges and over a year after he pleaded guilty in a related criminal case.

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EminiFX raised $262 million on fake robo-trading claims

EminiFX was launched in 2021 and quickly attracted over 25,000 investors, generating more than $262 million in just eight months. The firm claimed to offer weekly returns of 5% to 9.99% via a so-called “Robo-Advisor Assisted Account,” which supposedly employed automated trading strategies in cryptocurrency and forex markets.

However, court documents reveal that the platform incurred net losses of at least $49 million and never utilized the technology it advertised.

Investigators found that Alexandre diverted at least $15 million for personal expenses, including paying credit card bills, purchasing luxury vehicles, and making cash withdrawals. Investor withdrawals were made using funds from new participants instead of legitimate earnings.

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Court sentences EminiFX founder to nine years

Alexandre’s legal troubles began in May 2022, when both the prosecutors and the CFTC launched parallel actions against him. In the criminal case, he admitted to commodities fraud and received a nine-year prison sentence, along with a $213 million restitution order.

The civil case, now settled with Caproni’s ruling, imposes additional restitution and disgorgement requirements, although any payments made toward restitution “shall offset his disgorgement obligation,” according to the court ruling.

The court-appointed receiver, responsible for asset recovery and distribution since 2022, began disbursing recovered funds to victims earlier this year after a distribution plan was approved in January.