Network MarketingEmpiresX sufferer class-action filed in Florida (Receivership?)

EmpiresX sufferer class-action filed in Florida (Receivership?)


Two EmpiresX victims have filed a civil class-action in Florida.

That’s on prime of the CFTC’s and SEC’s civil regulatory lawsuits towards EmpiresX.

What’s fascinating is the Florida state court docket listening to the class-action has appointed an EmpiresX Receiver.

The CFTC and SEC EmpiresX case dockets got here up as we speak on BehindMLM’s calendar.

There wasn’t something new on the CFTC case docket. A submitting request extra time to file a Joint Scheduling Report on the SEC docket caught my consideration although, and that led me to this:

Defendant Empires Consulting Corp. is presently underneath a Florida state court docket receivership.

This was the primary I’d examine a Florida state lawsuit, and positively the primary I’d heard of an EmpiresX Receivership.

I pulled up the case in Florida and located a class-action filed towards EmpiresX on June tenth.

Class-action Plaintiffs Eric Villanueva and Francisco Gonzalez are each Florida residents.

Plaintiff Eric Villanueva joined EMPIRES-X in August 2021 by an EMPIRES-X recruiter.

His preliminary funding was within the quantity of $ 9,500; he made further contributions by April 2022 totaling $25,000.

He has not obtained any funds regarding his funding from EMPIRES-X DEFENDANTS.

Plaintiff Francisco Gonzalez joined EMPIRES-X in October 2021 by an EMPIRES-X recruiter. His preliminary funding was within the quantity of $ 4,200 and made no further contributions.

He has not obtained any funds regarding his funding from EMPIRES-X DEFENDANTS.

Who recruited Villanueva and Gonzales into EmpiresX isn’t disclosed.

Named defendants within the class-action are Empires X Corp, Empires Consulting Corp, EmpX Administration LLC, Emerson S. Pires, Flavio M. Goncalves and Joshua David Nicholas.

This can be a basic, however unlucky, story about how a well-orchestrated cryptocurrency ponzi scheme focused weak victims right here in South Florida.

These skilled criminals—who’ve just lately fled and are on the run with Plaintiffs’ and Class Members’ cash—had been solely in a position to steal tens of hundreds of thousands of {dollars} with the prepared help of different “respected” accomplices.

CoinBase is called as a associated non-party. The crypto trade is accused of aiding EmpiresX launder a “substantial portion” of invested funds.

Primarily based on the excessive quantity of exercise going down by EMPIRES-X’s and EMPIRES-X DEFENDANTS’ COINBASE accounts, COINBASE ought to have been alerted as to the suspicious exercise and may have promptly investigated the accounts.

However the regulatory necessities COINBASE confronted as a Cash Companies Enterprise underneath the FinCEN division of the U.S. Treasury Division, COINBASE turned a blind eye to the apparent pink flags.

COINBASE didn’t confirm that the cryptocurrency belongings—together with Bitcoin, Ether, and USD Tether—had been really derived from professional sources, which is one thing that might have simply been verified.

Actually, underneath the Financial institution Secrecy Act, COINBASE has an obligation to inquire and/or report if suspicious exercise is concerned in transmitting cash.

COINBASE knew or ought to have identified that the belongings being liquidated by its trade didn’t rightfully belong to EMPIRES-X and/or EMPIRES-X DEFENDANTS.

COINBASE turned a blind eye to the crimes that it facilitated.

Villanueva’s and Gonzales’ class-action, which often cites BehindMLM’s reporting, particulars the EmpiresX Ponzi scheme and subsequent collapse.

The EMPIRES-X scheme perpetrated by EMPIRES-X DEFENDANTS has harmed 1000’s if not hundreds of thousands of individuals nationwide and internationally, lots of which have misplaced their life financial savings.

In accordance with some current stories, there are as many as 1.2 million accounts registered with EMPIRES-X.20 An estimated 60 million {dollars}, conservatively, has been taken in by EMPIRES-X DEFENDANTS.

Villanueva and Gonzales, by their attorneys, search to symbolize EmpiresX victims.

Whereas the precise variety of class members stays unknown at the moment, upon info and perception, there are a minimum of 1000’s of putative Class members.

The precise quantity will likely be found by discovery. Actually, Undersigned Counsel presently represents over 85 EMPIRES-X customers, who collectively misplaced hundreds of thousands of {dollars} into the EMPIRESX PLATFORM alone.

Accompanying the proposed class-action was a movement searching for a Momentary Restraining Order, asset freeze and appointment of a Receiver.

The court docket granted the request for appointment of a Receiver on June twenty first.

The Court docket has been suggested that for the reason that submitting of the Emergency Movement and of the underlying Emergency Criticism within the above-captioned motion and previous to the listening to thereon, the Plaintiffs served the final identified registered brokers for Defendants With copies of the Emergency Criticism, the Emergency Movement, and the Discover of Listening to regarding the Emergency Movement.

All statements of reality on this order are based mostly on the affidavits offered by the Plaintiffs.

Within the instantaneous case, the investor Plaintiffs had been induced by Defendants to put money into Defendants’ purported funding scheme.

Along with Plaintiffs, Plaintiffs’ counsel have offered a declaration testifying that they symbolize over 160 further purchasers who invested within the Defendants’ funding scheme.

SCOTT DIMOND, Esq. is appointed the Receiver (the “Receiver”) of EMPIRES X CORP. EMPIRES CONSULTING CORP, and EMPX MANAGEMENT LLC, and all different entities operated, managed or in any other case related to the Defendants’ actions, which entities shall be deemed to be included within the time period “Receivership Entities” and shall serve till additional Order of this Court docket.

In a nutshell, the EmpiresX Receiver is now in cost EmpiresX and its belongings.

So far the EmpiresX Receiver has

  • subpoenaed TD Financial institution, CoinBase and GoDaddy for EmpiresX associated data (June twenty fourth)
  • subpoenaed Emerson Pires, Flavio Goncalves and Joshua David Nicholas for Empires X associated data (July 1st)

One fascinating level to notice is service on Pires, Goncalves and Nicholas, has been executed at identified Florida addresses.

That is at odds with Nicholas believed to be in custody following his indictment. Each the SEC and CFTC keep Pires and Goncalves have fled to Brazil.

The SEC and CFTC filed swimsuit towards the EmpiresX Defendants on June thirtieth.

On July twenty first the EmpiresX Receiver filed his first Standing Report. Within the report the Receiver suggested the court docket

  • TD Financial institution “has not positioned paperwork aware of the Receiver’s request”;
  • Coinbase has positioned responsive paperwork however has proposed an entry of confidentiality previous to turning them over;
  • GoDaddy has confirmed it should cooperate with turning over EmpiresX’s web site area to the Receiver;
  • Interactive Brokers Corp had been subpoenaed on July 1st however had but to reply;
  • the EmpiresX Receivership was in communication with each the SEC and CFTC relating to their respective civil instances, with a choice on how each regulators will proceed relating to the Receivership pending; and
  • in keeping with the SEC’s and CFTC’s assertions, Pires and Goncalves “have disappeared and are believed to have fled to a different nation”.

The Receiver has not but been in a position to take custody, possession, or management of any of the Receivership Entities.

So far, no substantial belongings have been positioned with respect to banking accounts, brokerage accounts, or cryptocurrency wallets which are within the custody, management, possession, or possession of the Receivership Entities.

The Receiver will proceed to make efforts to take custody, possession, or management of the Receivership Entities’ belongings.

On August 18th the EmpiresX Receiver filed a Movement to Compel, following Interactive Dealer Corp failure to reply to the Receiver’s subpoena.

Whereas it’s not uncommon for banking entities to be premature responding such subpoenas, greater than 5 weeks have handed for the reason that July 8, 2022 return date and IAB has neither responded nor even contacted the Receiver to debate the Subpoena.

Primarily based upon its failure to seem, this Court docket ought to enter an order compelling IAB to supply the requested paperwork and instantly to indicate trigger as to why IAB shouldn’t be sanctioned for its failure to adjust to the Subpoena.

A listening to on the Receiver’s IAB present trigger movement has been scheduled for August twenty sixth.

On August 18th the Receiver additionally filed his Second Standing Report with the court docket.

Within the report, the Receiver knowledgeable the court docket

  • with the cooperation of GoDaddy he had taken possession of EmpiresX’s web site area and disabled it;
  • he had reached an settlement with Coinbase on confidentiality, who had since gone on to offer the Receiver with requested manufacturing;
  • he was nonetheless in communication with the SEC and CFTC, neither of which had reached a choice on the right way to deal with the Receivership scenario; and
  • there had been no change with respect to recovering EmpiresX belongings from the earlier report.

On August twenty second the beforehand scheduled August twenty sixth IAB present trigger listening to was rescheduled for August twenty fourth (later as we speak). Notice that the August twenty sixth listening to nonetheless seems scheduled on the case docket.

Wanting ahead, an Preliminary Case Administration Convention has been scheduled for September twelfth. Pending the result of the scheduled present trigger listening to as we speak, I’ll present an replace under.

Usually in terms of adversary proceedings, the pecking order is DOJ (prison) –> federal regulators (SEC, DOJ) –> civil litigation (sometimes buyers attempting to get their a refund).

The DOJ intervenes in federal regulatory instances and has them stayed, and federal regulators do the identical with civil proceedings.

At the least that’s how issues usually go. What we now have right here is the primary MLM fraud case I’ve seen the place a state-level court docket has independently ordered the appointment of a Receivership, as a part of sufferer civil proceedings.

I believe the SEC and CFTC (or presumably the DOJ) will intervene in some unspecified time in the future however, for now a minimum of, that hasn’t occurred but.

Earlier than anybody who misplaced cash in EmpiresX asks, no you’ll be able to’t be a part of the class-action but.

Within the sudden occasion EmpiresX class certification is granted, or the case is stayed, we’ll preserve you posted.


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