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The Securities and Exchange Commission (SEC) and federal prosecutors have brought charges against Ramil Palafox for allegedly operating a fraudulent cryptocurrency trading scheme that swindled approximately $200 million from 90,000 investors worldwide. The charges, announced on April 22, 2025, mark the first crypto-related case under the SEC’s new chair, Paul Atkins.
According to the SEC complaint, Palafox, a dual citizen of the United States and the Philippines, operated PGI Global between January 2020 and October 2021. The company claimed to offer high returns through cryptocurrency and foreign exchange trading. Investigators allege Palafox misappropriated over $57 million in investor funds during this period.
The SEC claims Palafox used a multilevel marketing model to execute what they describe as a “Ponzi-like” scheme. Investors were allegedly lured with “false claims of crypto industry expertise and a supposed AI-powered auto-trading platform.” The scheme collapsed in late 2021, leaving many investors with substantial losses.
Court documents reveal that Palafox hosted extravagant events in Dubai and Las Vegas to recruit new members to his scheme. These individuals were offered referral bonuses to bring in additional investors, creating a pyramid-like structure that helped the scheme grow rapidly.
“Palafox attracted investors with the allure of guaranteed profits from sophisticated crypto asset and foreign exchange trading,” said Scott Thompson, Associate Director of the SEC’s Philadelphia Regional Office. Instead of legitimate trading activities, Thompson alleges that Palafox used investor money to purchase luxury items and fund his lifestyle.
The scheme promised daily returns ranging from 0.5% to 3% from Bitcoin trading. Palafox allegedly told investors that his traders could generate profits regardless of Bitcoin’s price movement, claiming they would make money whether the market went up or down.
Federal prosecutors contend that most investor funds were never actually used to purchase or trade Bitcoin. The Justice Department alleges that many participants lost some or all of their investments when the scheme ultimately collapsed.
The indictment details an array of luxury items purchased with investor funds. If convicted, Palafox would forfeit over $1 million in cash, 17 vehicles, and numerous luxury goods. The vehicle collection includes two Teslas, a Ferrari 458 Special, two Lamborghinis, and two Porsches.
“Palafox used the guise of innovation to lure investors into lining his pockets with millions of dollars while leaving many victims empty-handed,” said Laura D’Allaird, Chief of the SEC’s new Cyber and Emerging Technologies Unit.
The Department of Justice had previously seized the website for Praetorian Group International Trading Inc., one of the companies linked to the scheme, in 2021. This action led to the shutdown of its UK-based operations by the High Court.
The SEC is seeking several penalties against Palafox, including a permanent injunction to ban him from future sales of securities and crypto assets. The regulator is also pursuing repayment of ill-gotten gains and civil penalties.
In a parallel criminal case, the U.S. Attorney’s Office for the Eastern District of Virginia has charged Palafox with wire fraud, money laundering, and unlawful monetary transactions. These charges were filed under seal on March 13 and recently unsealed.
The SEC complaint also names several relief defendants: BBMR Threshold LLC, Darvie Mendoza, Marissa Mendoza Palafox, and Linda Ventura. The Commission is seeking disgorgement of their alleged ill-gotten gains with prejudgment interest.
This case represents a major enforcement action in the cryptocurrency space and highlights ongoing regulatory scrutiny of the sector. The investigation involved collaboration between multiple agencies, including the SEC, FBI, and IRS.
The SEC’s Office of Investor Education and Advocacy has directed investors to resources on detecting and avoiding pyramid schemes posing as multi-level marketing programs. Investors seeking additional information can visit Investor.gov.
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