US Commodity Futures Trading Commission (CFTC) has filed a lawsuit against the Debiex platform, which is presented as a crypto exchange, for stealing $2.3 million from investors using a fraud method called “pig butchering”.
Another “Pig Butchering” Case Targeting Crypto Participants
In its lawsuit, the CFTC accused Debiex and Zhang Cheng Yang, who may have acted as a so-called “money mule” for the platform. The complaint was filed on January 19th in the US District Court for the District of Arizona. According to the CFTC, unidentified individuals involved with Debiex lied to gain trust and developed friendly or romantic relationships with potential customers, then later demanded that they open accounts and deposit money into Debiex.
The US regulator added that Debiex appropriated approximately $2.3 million from five customers as part of the plan. The CFTC is seeking a refund for these customers, compensation, a monetary penalty, a trading ban, and a permanent injunction. CFTC Enforcement Director Ian McGinley stated, “This case is an example of the core mission of the CFTC’s Enforcement Division. We seek justice for victims, to root out abuse, and to hold accountable those who violate the anti-fraud provisions of the CEA.”
According to the CFTC, Debeix specifically targeted Asian Americans. They were lured through US-based social media platforms and then encouraged to open trading accounts and make deposits. The US regulator noted that instead of using the funds as claimed on behalf of the customers, Debiex misappropriated the customers’ funds. The CFTC stated, “Without the customers’ knowledge and contrary to claims, the Debiex website was merely imitating the features of a legitimate live trading platform, and the ‘trading accounts’ on the websites were completely deceptive. No real trading was conducted on behalf of the customers.”
Second “Pig Butchering” Case Filed by the CFTC
CFTC member Kristin Johnson said that the case filed is the second pig butchering case the regulator has opened in the past few months. Johnson stated, “As the name suggests, in these types of fraud schemes, consumers are fraudulently encouraged to invest, similar to ‘fattening’ a pig before slaughter.” It is known that the CFTC first filed a lawsuit in June 2023 against a similar structure, including a crypto, commodity, and forex company.
Johnson also said, “In the current case, scammers used a common native language and other similar identity proofs to gain trust, but later this intimate relationship was exploited. I invite all members of the public to visit our investor advisory page to become informed about potential fraud and abuses in the crypto market.”
