FTC Refunds $470,000 to Crypto Scam Victims

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  • The FTC has begun paying refunds to victims of three crypto Ponzi schemes
  • Bitcoin Funding Team, My7Network, and Jetcoin ran various from 2017 to 2018
  • Each victim will get $59 into their PayPal account

The Federal Trade Commission (FTC) has started refunding more than $470,000 to victims of a series of cryptocurrency scams dating back to 2017 that they shut down two years ago. Bitcoin Funding Team, My7Network, and Jetcoin were promised guaranteed returns on cryptocurrency trading but were nothing but Ponzi schemes with new money being used to pay out existing investors. Following a court order in March 2018, the companies’ activities were halted and the founders’ assets frozen, leading to the ability to recover some of the funds and return them to victims.

FTC Gets Trio of Ponzi Schemes Stopped

Bitcoin Funding Team, My7Network, and Jetcoin ran variously between February 2017 and February 2018 by Thomas Dluca, Louis Gatto, and Eric Pinkston. The trio used websites, YouTube videos, social media, and conference calls to reach investors, promising big rewards for small up front payments in Bitcoin or Litecoin.

The FTC began looking into the affairs of the trio in late 2017 following complaints from investors who weren’t getting their expected returns, eventually appealing to the U.S. District Court for the Southern State of Florida in February 2018 to halt the activities of the three men and freeze their assets. The courts granted the FTC request in March 2018, and Dluca, Gatto, and Pinkston were charged with violating the FTC Act’s prohibition against deceptive practices.

Repayments Could Increase

In August 2019 the three agreed to settle with the FTC, with Dluca on the hook for $453,932, Chandler for $31,000, and Pinkston for $29,491. Following receipt of the funds, the FTC began distributing the refunds to the 7,964 victims via PayPal last week, with the average refund being approximately $59. This refund will be a far cry from what many will have invested, but it’s $59 more than most scam victims get back.

The amount may also increase if Pinkston is shown to have lied about his low income, which was the reason why his penalty was reduced from the FTC desired figure of $461,035.