The CEO of EminiFX.com, Eddy Alexandre, who is Haitian, is reportedly set to plead guilty to charges of running a Ponzi scheme that allegedly collected over $59 million. Alexandre is the founder, president, and sole owner of EminiFX, a company that promised investors they could make substantial profits by investing in cryptocurrency and forex markets. However, according to a complaint filed in the Southern District of New York, the profits investors believed they were making were not real.
The Appeal of EminiFX
Despite the charges, many investors have come forward to defend Alexandre. They were drawn to EminiFX’s online investment platform, which promised a minimum weekly return of 5 percent, sometimes reaching almost 10 percent. This led investors like Frantz Victorin to believe that he would become a millionaire in less than a year. Victorin even took out at least four loans from different banks to invest in EminiFX.
The Alleged Ponzi Scheme
However, the FBI alleges that the proprietary trading platform used by EminiFX was a fraud, and Alexandre was running a Ponzi scheme that collected over $59 million from September 2021 until he was arrested in May. The Commodity Futures Trading Commission has also filed a separate complaint alleging that only about $9 million of the funds raised from investors was sent to a futures commission merchant for trading purposes, with the rest of the funds misdirected to Alexandre’s personal bank account.
The federal complaint alleges that EminiFX falsely represented to investors each week that they had earned at least 5 percent on their investment, which they could withdraw or reinvest. Alexandre also reportedly told investors that if they invested $100,000, they would be millionaires within two to three years. However, the platform only invested a small percentage of investor funds, and trading by Alexandre at an online brokerage racked up over $6 million in losses.
Guilty Plea and Investor Support
Despite the charges against him, Alexandre has not publicly commented on the case. However, he is set to plead guilty to commodities fraud and wire fraud offenses. A temporary receiver for EminiFX.com, David Castleman, has reported that over $62 million has been frozen. Remarkably, many of Alexandre’s investors are supporting him, with a change.org petition defending him having over 11,000 signatures. Some signers have suggested that the government targeted Alexandre because he is a Black immigrant, claiming that the charges are unfounded and racist. As of now, the EminiFX.com website has been taken down, and it is unclear what will happen to the investors’ funds.
The case has generated significant attention in the Haitian community, with many expressing outrage at the charges against Alexandre. However, some experts warn that the case highlights the dangers of investing in unregulated online platforms promising high returns. EminiFX was not registered with the Commodity Futures Trading Commission, which oversees the futures and options markets, or with the Securities and Exchange Commission, which regulates securities and investment companies.
Investors who believed they were making significant profits through EminiFX.com have been left with nothing. The case serves as a reminder that if an investment seems too good to be true, it probably is. Investors should always do their due diligence before investing money and should be wary of promises of quick returns and guaranteed profits.
The fallout from the EminiFX case is likely to be significant, not just for the investors who lost money, but for the broader cryptocurrency and forex markets. The case highlights the need for greater regulation of these markets and increased scrutiny of unregistered investment platforms.
In the meantime, Alexandre’s guilty plea will likely result in significant prison time, as well as fines and restitution payments to the victims of the alleged Ponzi scheme. The case serves as a cautionary tale about the dangers of investing in unregulated online platforms and the importance of conducting proper due diligence before investing in any opportunity.