The United States Commodity Futures Trading Commission (CFTC) has announced a record-breaking $17.1 billion in monetary relief for fiscal year 2024, largely driven by enforcement actions involving cryptocurrency cases.
The record monetary relief comprised $2.6 billion in civil monetary penalties (CMP) and $14.5 billion in disgorgement and restitution, the CFTC officially announced on Dec. 5.
The recovery was largely contributed by the agency’s crackdown on the defunct crypto exchange FTX, which collapsed in November 2022.
The FTX case accounted for $12.7 billion in CFTC restitution and disgorgement, becoming the “largest recovery for victims and sanctions in CFTC history.”
FTX and Binance top the CFTC’s recovery relief in 2024
The CFTC’s case against FTX involved fraud claims against the exchange, its sister firm Alameda Research, and several executives, including founder Sam Bankman-Fried. The settlement ordered $8.7 billion in restitution and $4 billion in disgorgement, making it the largest recovery in the agency’s history.
Bankman-Fried was sentenced to 25 years in prison in March, and the CFTC’s FTX litigation is continuing, the agency said.
CFTC announces 2024 enforcement results. Source: CFTC
The cases are ongoing against other defendants, including FTX co-founder Gary Wang, former Alameda co-CEO Caroline Ellison, and, in a separate action, former FTX co-owner Nishad Singh, it added.
In a settlement against crypto exchange Binance, its founder and former CEO Changpeng Zhao and other executives, the CFTC recovered $150 million from Zhao and $1.35 billion in civil monetary penalties. The court also ordered Binance to pay $1.35 billion in disgorgement, the CFTC noted.
Other crypto cases
Among other significant CFTC cases in crypto, the agency mentioned charging Voyager’s former CEO Stephen Ehrlich with commodity pool fraud and registration failures.
“This year, the federal district court denied the former CEO’s motion to dismiss, holding in the CFTC’s favor on numerous significant legal questions,” the CFTC noted, adding that the litigation is ongoing.
The CFTC also won an order granting summary judgment on all counts, finding defendants Seneca Ventures to be a fraudulent Ponzi-like scheme involving purported investment in crypto, derivatives and misappropriation of funds through a carbon offset program.
Related: Trump eyes handing CFTC oversight of crypto: Report
The court ordered Seneca Ventures defendants to pay at least $110.9 million in CMP, in addition to $83.7 million in restitution and $36.9 million in disgorgement.
Additionally, the CFTC charged a defendant with engaging in romance scam tactics to fraudulently misappropriate $2.3 million in customer funds intended for digital asset commodity trading.
“The CFTC remains steadfast in its duties to protect customers and vigorously oversee CFTC-regulated markets critical to the health of the US economy,” CFTC Chairman Rostin Behnam said, adding:
“Misconduct in our jurisdictional markets is rarely confined, especially as these boundaries are continually being redefined by disruptive technology.”
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