The Commodity Futures Trading Commission (CFTC) has secured a Preliminary Injunction Order against Defendants Patrick K McDonnell and CabbageTech, d/b/a Coin Drop Markets (CDM) over a fraudulent virtual currency scheme.
The Court’s decision stems from the CFTC’s 18 January 2018 Complaint charging Defendants with fraud and misappropriation in connection with purchases and trading of the virtual currencies Bitcoin and Litecoin.
Following a hearing on 6 March 2018, Judge Jack B Weinstein of the US District Court for the Eastern District of New York found that the CFTC had shown a reasonable likelihood that Defendants will continue to violate the Commodity Exchange Act (CEA). The Court’s Order prohibits the Defendants from engaging in fraud in violation of the CEA, requires the Defendants to preserve books and records, and to provide expedited discovery.
In its continuing litigation, the CFTC is seeking, among other relief, a permanent injunction against future violations of federal commodities laws, restitution to defrauded customers, disgorgement of benefits from violations of the Commodity Exchange Act and CFTC Regulations, civil monetary penalties, and trading bans, as charged.
