"Expert traders. Proprietary algorithms. Artificial intelligence. Up to 15% a week." If that pitch sounds familiar, it's because some version of it is in your DMs right now. On September 25, 2026, the CFTC put a price tag on one of the biggest versions of it: more than $950 million raised, and at least $406 million lost, according to the agency's complaint.
What happened
The Commodity Futures Trading Commission announced charges against Cash FX Group S.A. and its CEO, Huascar Jose Lopez Castillo, of Brazil; The Conversion Pros, Inc. and its CEO, Ronald Pope, of Oregon; and Justin Halladay, of Florida. The complaint was filed in the U.S. District Court for the Middle District of Florida. According to the CFTC and coverage by Crowdfund Insider and The Crypto Times, the agency alleges that:
- From at least June 2019 through December 2023, the defendants ran a multilevel-marketing Ponzi scheme, soliciting more than $950 million from the public, including U.S. residents, supposedly to trade retail foreign currency contracts in a commodity pool.
- Cash FX told participants their money would be traded by expert traders, proprietary algorithms and artificial intelligence, and promised returns of up to 15% per week.
- Participants were told 70% of their contributions would go to forex trading by professional traders, trading bots and AI, and 30% would fund an "Academy Program" offering trading education.
- In reality, the CFTC alleges, there was little actual trading. New deposits were used to pay earlier participants, funds were misappropriated, and crypto wallets were used for payments. Participants lost at least $406 million.
- According to BehindMLM's reading of the complaint, the CFTC alleges Lopez took at least $96 million, Pope at least $15.4 million and Halladay at least $16 million.
The CFTC is seeking restitution, disgorgement, civil monetary penalties, trading and registration bans, and a permanent injunction. These are allegations in a civil complaint; the defendants have not been found liable, and the reports reviewed did not include their responses.
Why futures and prop traders should care
Look at the structure the CFTC describes: a trading product plus an education product. Seventy percent "for the AI," thirty percent "for the Academy." That combination, bot returns bundled with trading courses, is everywhere in the retail futures and forex world. It gives a scheme a veneer of legitimacy ("we teach you, too") and gives recruits something to sell to the next layer.
The CFTC has warned about this playbook directly. Its customer advisory, "AI Won't Turn Trading Bots into Money Machines," exists because the "AI trading" label has become a favorite wrapper for fraud. The SEC is seeing the same thing: in May 2026 it sued a Texas man over what CoinDesk described as a $12.3 million alleged crypto scheme built on fake AI trading bots.
The controversy: whose fault is this?
The hard line: anyone promising 15% a week is running a fraud, and anyone who believes it should have known better. Regulators can't protect people from arithmetic.
The softer view: MLM structures work precisely because the pitch comes from friends, family and community leaders, not from strangers. Recruits often become recruiters before they realize anything is wrong. And the scheme alleged here ran for four and a half years before charges, which raises fair questions about how long enforcement takes to catch up.
Our take
Our take: The most dangerous word in retail trading right now isn't "leverage." It's "AI." It's the perfect cover because nobody can check it. A human trader's track record can be audited. A "proprietary algorithm" is a black box by design, so the only evidence is the payout, and in a Ponzi the payout is just the next person's deposit. Real systematic trading has drawdowns, losing weeks and boring months. If a bot's returns look smooth and huge, that's not a feature. That's the tell.
The uncomfortable question: how many trading "academies" would survive if they had to show audited, live results for the strategies they sell?
What traders should do (general, not advice)
- Check registration. Ask whether the operator and the pool are registered with U.S. regulators, and verify it yourself rather than trusting a screenshot.
- Be suspicious of any product where you earn more by recruiting than by trading.
- Treat "AI-managed" returns with no verifiable, independent record as marketing, not evidence.
- If a weekly return figure is quoted, annualize it. The absurdity usually becomes obvious.
Key takeaways
- On Sept. 25, 2026, the CFTC charged Cash FX Group, its CEO and others with running an alleged $950 million MLM Ponzi scheme.
- The CFTC alleges participants were promised up to 15% weekly from expert traders, algorithms and AI; losses were at least $406 million.
- The pitch bundled "AI trading" with an "Academy Program" for trading education.
- These are civil allegations; no liability has been established.
- Our view: "AI" is now the favorite wrapper for trading fraud. Demand verifiable results.
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FAQ
What is the CFTC alleging against Cash FX?
That from June 2019 to December 2023 Cash FX and associates ran a multilevel-marketing Ponzi scheme, raising over $950 million supposedly for AI and expert-driven forex trading, with participant losses of at least $406 million.
What returns did Cash FX promise?
According to the CFTC, up to 15% per week, attributed to expert traders, proprietary algorithms and artificial intelligence.
How can I check if a trading pool is legitimate?
Start by independently verifying whether the operator and pool are registered with U.S. regulators, and be wary of recruitment-based compensation and unverifiable 'AI' returns.
Loomi.Ai provides educational market research, not financial advice. Trading futures and options involves substantial risk of loss, and backtested results are historical and do not guarantee future returns.
Sources
- CFTC Charges Cash FX Group S.A., and CEO; Three Others With $950 Million Fraud Scheme, CFTC
- Cash FX Faces CFTC Lawsuit Over Alleged $950M Cryptocurrency Linked Forex Fraud, Crowdfund Insider
- CFTC Charges Cash FX Over $950M Forex Scheme Involving Crypto, The Crypto Times
- CFTC files suit against CashFX Group, $950 mill Ponzi, BehindMLM
- Customer Advisory: AI Won't Turn Trading Bots into Money Machines, CFTC
- SEC sues Texas man over $12.3 million alleged crypto scheme built on fake AI trading bots, CoinDesk