On 12 October, the
The CFTC alleges that Ehrlich acted fraudulently by soliciting participation in the Voyager platform, touting it as a "safe haven to hedge [ ] assets," operating with the "same level of rigor and trust" as traditional financial institutions, including
The CFTC further alleges that Voyager operated an unregistered commodity pool because it solicited, accepted, or received customer assets (including "digital asset commodities" such as Bitcoin (BTC) and USD Coin (USDC)) for the purpose of trading derivatives. And, because he solicited members of the public to participate, Ehrlich is alleged to have operated as an unregistered associated person (AP) of Voyager (itself alleged by the CFTC to be an unregistered CPO). In contrast, the
In a statement, CFTC Commissioner Pham cautioned that the complaint's interpretation of a CPO seemed to include traditional lending activity, which she called "an overreach beyond our statutory authority" that would disrupt well-established, separate regulatory frameworks. Commissioner Pham's observations may have merit. It is well understood that a CPO solicits, receives, or accepts funds or property for the purpose of trading in commodity interests. The facts alleged in the complaint state that Voyager turned over customer funds to other companies as loans for which it expected to be paid interest, and those other companies may have used the loan proceeds to trade derivatives. It will be for the District Court to decide whether these facts would render Voyager an unregistered CPO (and Ehrlich an unregistered AP of such CPO).
The CFTC is seeking a broad range of remedies, including fines, disgorgement, and permanent trading and registration bans against Erhlich. As noted in a statement by CFTC Commissioner Johnson, the
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