The explosion of cryptocurrency has created shiny, new ways to commit the same old fraud, according to The Securities and Exchange Commission. The agency is suing an operator of a multilevel marketing scheme who allegedly promised participants digital currency in exchange for their investments in the company.
The SEC’s complaint alleges Daniel Pacheco, who headed up IPro Solutions LLC and IPro Network LLC, offered fraudulent, unregistered securities through his now-defunct Irvine, California companies. In a little over a year, Pacheco raised $26.5 million through IPro, according to the complaint. The scheme went bust last May when Pacheco was unable to pay out recruitment commissions after using investments to buy a $2.5 million home in Redlands, California, and a Rolls Royce, according to the SEC.
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