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CFTC Secures Over $120 Million Judgment Against Sam Ikkurty in Crypto Ponzi Scheme
A federal court has ordered Oregon resident Sam Ikkurty and his entities to pay more than $83.7 million in restitution and $36.9 million in disgorgement for operating an unregistered digital asset Ponzi scheme.
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The U.S. District Court for the Northern District of Illinois has entered a summary judgment order against Oregon resident Sam Ikkurty and his associated companies, ordering over $83.7 million in restitution to victims and $36.9 million in disgorgement. The judgment follows an enforcement action by the Commodity Futures Trading Commission (CFTC) against Ikkurty, Jafia, LLC, Ikkurty Capital, LLC (doing business as Rose City Income Fund I), Rose City Income Fund II, and Seneca Ventures, LLC.
Judge Mary Rowland ruled that the defendants committed multiple violations of the Commodity Exchange Act (CEA) and CFTC regulations, operating what was described as a classic Ponzi scheme while failing to register as commodity pool operators. In addition to restitution and disgorgement, the CFTC is pursuing civil monetary penalties and injunctive relief.
According to court findings, Ikkurty solicited participants through trade shows and webinars by promising a steady 15% annual income from supposed net profits generated through investments in digital asset commodities such as Bitcoin and Ethereum. To convince victims, Ikkurty promoted fabricated historical performance and claimed personal trading success, while hiding that his fund had plunged in value by 98.99% within a few months and that his primary personal digital asset experience involved losing Bitcoins to a hack.
The court also found that the defendants misappropriated investor capital via a carbon offset program. The defendants sold products supposedly backed by digital assets tied to carbon offsets, but instead of holding the collateral, they transferred the incoming funds to earlier investors in other funds to mask losses. This scheme created a shortfall of more than $20 million for participants in the carbon offset initiative.
The court ruling confirmed that along with Bitcoin and Ethereum, non-Bitcoin virtual currencies OHM and Klima qualify as commodities within the CFTC's jurisdiction. The CFTC reminded the public that court-ordered restitution does not guarantee full recovery of lost funds if the perpetrators lack sufficient assets, urging investors to always verify registration records through NFA BASIC before committing capital to commodity pools or trading ventures.