A federal court in New York has ordered EminiFX and its founder, Eddy Alexandre, to repay more than $228 million after ruling that the failed crypto trading platform was a massive Ponzi scheme.
The ruling marks one of the largest restitution orders tied to digital asset fraud in recent years and comes more than three years after Alexandre was first charged.
Judge rules on restitution and disgorgement
US District Judge Valerie Caproni ruled this week that Alexandre and EminiFX are jointly and severally liable for $228,576,962 in restitution to defrauded investors.
The court also ordered Alexandre to pay $15 million in disgorgement, though any payments toward restitution will offset that obligation.
The ruling follows a summary judgment obtained by the US Commodity Futures Trading Commission (CFTC), which accused Alexandre of operating a fraudulent trading scheme that deceived tens of thousands of investors.
The decision adds another layer of accountability to Alexandre’s legal troubles, complementing an earlier criminal case that led to his imprisonment.
EminiFX raised millions on false promises
Launched in 2021, EminiFX quickly gained traction by promoting what it called a “Robo-Advisor Assisted Account.” The platform promised weekly returns of between 5% and 9.99%, allegedly generated through advanced trading strategies in cryptocurrencies and foreign exchange markets.
In less than a year, more than 25,000 investors signed on, pouring in over $262 million.
Court documents show that while the company advertised automated trading technology, it never deployed any such system. Instead, EminiFX accumulated net losses of at least $49 million.
Investigators revealed that Alexandre used at least $15 million of investor funds for personal expenses. These included luxury cars, credit card bills, and cash withdrawals.
At the same time, withdrawals by early investors were paid using funds contributed by new participants, the hallmark of a Ponzi structure.
Criminal conviction and prison sentence
EminiFX’s collapse began in May 2022 when federal prosecutors and the CFTC filed simultaneous actions against Alexandre.
In the criminal case, Alexandre pleaded guilty to commodities fraud and admitted to misleading investors, and he was sentenced to nine years in prison in 2023 and ordered to pay $213 million in restitution.
Recovery efforts for victims
Since 2022, a court-appointed receiver has been managing the recovery of assets tied to EminiFX.
Earlier this year, the receiver began distributing recovered funds to victims after a distribution plan received court approval in January.
The restitution order is expected to further guide how investors receive compensation for their losses.