Leonardo Cositorto, the creator of Generation Zoe, was cleared by Argentina’s CNV after an internal probe.
The CNV concluded that Cositorto did not “operate with bonds, shares or other negotiable securities,” despite the fact that Generation Zoe was an MLM crypto Ponzi that deceived customers out of $747 million pesos (about $36.1 million USD).
Conventional regulation in other parts of the globe contradicts CNV’s conclusion that Ponzi schemes are not unregistered securities offers.
The Howey Test is used in the United States to ascertain if an investment contract exists.
An “investment of money in a common enterprise with a reasonable expectation of profits to be derived from the efforts of others” constitutes an investment contract.
A securities offering is created when an investment contract is present, making it easier for dishonest people to commit securities fraud. Charges of money laundering and wire fraud are typically included as well.
Generally, every country with a regulated financial market has a comparable procedure for recognizing securities offerings, even though the specifics and terminology may vary in other nations.
The following is how the Howey Test is applied to Generation Zoe’s business model:
The presence of an investment contract creates a securities offering, which facilitates securities fraud by unscrupulous individuals. Usually, there are also charges of wire fraud and money laundering.
Even if the details and language may differ in various countries, every nation with a regulated financial market generally has a similar process for identifying securities offers.
The Howey Test is applied to Generation Zoe’s business plan as follows:
0.1 ETH was given to the communal company by Generation Zoe participants.
This move was motivated by the stated 3.94 ETH ROI, which is a reasonable expectation of earnings.
Generation Zoe’s ROI payments were made using the ETH that was later invested, which was acquired through both direct and indirect solicitation of new investors (others’ efforts). However, as Infobae noted on February 4th;
Even if a clearly inadequate financial regulator cleared Cositorto (right) of civil fraud allegations, he still has to defend criminal charges against him.
Naturally, Cositorto boasted on social media following CNV’s ruling, which he freely accesses while detained using an illegal mobile phone;
I can’t hold him responsible. Not every day does the nation’s top financial regulator approve your Ponzi scheme worth three-quarters of a billion pesos.
The regulator emphasized on clearing Cositorto, who falsely claimed to have CNV approval during Generation Zoe’s tenure.
According to this decision, “the actions reported and being processed in court cannot constitute criminal offenses under any circumstances.”
That is, I suppose, unless the judges in Argetina also approve of Cositorto’s Generation Zoe scam.
Four Argentine provinces have filed criminal charges against Cositorto. On February 4th, Cositorto’s first criminal trial in Goya resumed after a brief break.
as stated on January 22nd by Indian Express;
The director of Platinum Hern Pvt Ltd, which is owned by Torres, Victoria Kovalenko, Mustafa Karakoc, Oleksandr Borovyk, Oleksandr Zapichenko, Oleksandra Brunkivska, Oleksandra Tredokhib, Artem Oliferchuk, and Iurchenko Igor, Olena Stoian, has been the subject of a blue corner notice from the police.
According to an EOW officer, Mustafa Karakoc is Turkish, while the others are Ukrainian.
Alpesh Khara was also taken into custody by Indian officials between January 10 and January 21. Khara is connected to the laundering of around $23 million USD (Rs. 2 billion) in tether (USDT) out of India.
Indian officials declared on January 27th that CEO Tausif Reyaz had been taken into custody.
The estimated total losses of Torres, which were taken from over 125,000 investors, amount to Rs. 10 billion (about $115 million USD).
The remaining Ukrainian con artists responsible for the Torres fraud are still at loose, with the exception of the two insiders who were detained in India.
