The
Commodity Futures Trading Commission (CFTC) has filed a civil complaint against
Travis Ford and his company, Wolf Capital Crypto Trading, accusing them of
operating a fraudulent cryptocurrency investment pool that misled investors and
misappropriated funds.
The
complaint alleges Ford and Wolf Capital collected at least $10.1 million from
more than 3,376 participants between October 2022 and December 2024 through an
unregistered commodity pool. Investors deposited stablecoins into a smart
contract on the Ethereum blockchain after being promised daily returns ranging
from 1% to 3.5%, which would translate to annual returns between 365% and
1,277.5%.
Trading Losses Masked by
Fabricated Reports
Ford told
investors he would generate returns by trading Bitcoin, Ethereum, and
cryptocurrency futures using both manual trading and automated bots. He
positioned himself as an experienced trader who made “a small
fortune” trading oil during the COVID-19 pandemic, though regulators say
he had little actual experience trading digital assets and lost money on oil
company stocks.
According
to the complaint, Ford posted only profitable trades to Wolf Capital’s Telegram
and Discord channels while hiding losing trades from investors. Between
February and July 2023, Ford shared 72 trade results from one exchange showing
profits of $3.5 million, but exchange records revealed he actually executed 422
trades during that period with total losses of $869,254, an overstatement of
more than $4.3 million.
Ford later
admitted to using Photoshop to create fake trade screenshots and portfolio
values that showed profits where none existed. The falsified reports gave
investors the impression that their funds were growing, even as Wolf Capital’s
actual assets had dwindled to around $3,000 by August 2023.
Ponzi Scheme Funded
Withdrawals
When
trading losses made it impossible to pay promised returns, Ford began using new
investor deposits to pay existing investors. The CFTC has
pursued several major Ponzi schemes in recent years, including cases involving $145 million in
forex trading fraud.
Ford
admitted in July 2023 that Wolf Capital paid out $2.4 million in returns that
didn’t come from trading profits but from other participants’ deposits. After
the scheme collapsed, Ford attempted to reduce daily returns twice—first from
2% to 1.5% in April 2023, then to 1.1% in June 2023, before halting all
operations in July 2023.
Despite
promising investors they could withdraw funds after a 60-day lockup period,
most participants never received their initial deposits back. Ford continued
encouraging investors to leave their money in the smart contract with promises
of recovering losses through future trading and business ventures that never
materialized.
Registration Violations
and Criminal Conviction
Neither
Ford nor Wolf Capital ever registered with the CFTC as a commodity pool
operator or associated person, as required by law. The commission’s enforcement
action follows a pattern of pursuing unregistered
commodity pool operators, with one Texas case resulting in $13 million in sanctions.
Ford
pleaded guilty to conspiracy to commit wire fraud on Jan. 9, 2025, in related
criminal proceedings. He was sentenced on Nov. 13, 2024, to five years in
prison and ordered to pay monetary relief. In his guilty plea, Ford admitted he
“did not believe those investment returns were possible to achieve
consistently” and made false statements intending to induce people to
invest or remain invested in Wolf Capital.
The CFTC’s
civil complaint seeks restitution, disgorgement of profits, civil monetary
penalties, and permanent bans preventing Ford and Wolf Capital from trading or
registering with the agency.
The case
shares similarities with other cryptocurrency-related fraud prosecutions,
including a $31 million
penalty imposed in a forex and crypto fraud case and charges brought against a crypto-forex
scheme involving artificial intelligence claims.
Wolf
Capital operated as a sole proprietorship until April 2023, when Ford organized
it as an Oklahoma limited liability company. The entity is currently listed as
“Inactive” on the Oklahoma Secretary of State website.
This article was written by Damian Chmiel at www.financemagnates.com.
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