Forcount founder Francisley Valdevino Da Silva (aka Francis Silva), has been sued by the SEC.
The SEC has additionally filed civil fraud fees towards three US-based promoters.
Francis Da Silva (proper), refers to himself because the “Cryptocurrency Sheik” and “boss of the pyramid scammers”.
Da Silva, a Brazilian nationwide, is the founding father of Forcount and different MLM crypto Ponzis.
Presumably upon studying he was underneath investigation, Da Silva fled the US for Brazil in January 2022.
As a part of an investigation into an $800 million Ponzi empire, Da Silva was arrested by Brazilian authorities on November third.
Juan Antonio Tacuri Fajardo is a prime Forcount promoter and resident of Florida. Fajardo was arrested by US authorities on December 14th, 2022.
Each Da Silva and Tacuri have been indicted in parallel legal fees pertaining to Forcount.
Ramon Antonio Perez Arias and Jose Ramiro Coronado Reyes dodged legal fees, however have been sued by the SEC as prime Forcount promoters.
Each Perez and Reyes are residents of Florida and shared a prime Forcount investor account.
Of their December 14th filed grievance, the SEC identifies Forcount as “a faux crypto asset buying and selling and mining firm.”
Forcount claimed that investments by Forcount would lead to returns from “each day commerce by our calibrated robots to generate each day earns!”
Forcount additionally claimed traders would obtain returns from Forcount’s use of “clever mining system” with “10,000 machines” that “routinely mine” such crypto property.
Regardless of Defendants guarantees of returns based mostly on Forcount’s buying and selling and mining, in addition to the referral program, Forcount had no actual income aside from funds acquired from traders.
Forcount’s web site displayed fictitious returns based mostly on the required quantities and sorts of crypto property that traders appeared to carry of their Forcount accounts.
Defendants had no foundation for the promised returns, and funds acquired from later traders had been used to make Ponzi-type funds to
earlier traders.
This confirms BehindMLM’s Forcount evaluation, revealed in Could 2018.
Along with being a Ponzi scheme, the MLM aspect of Forcount operated as a pyramid scheme.
Forcount didn’t promote any actual services or products to retail clients in the course of the related time interval, and had no obvious income aside from funds acquired from traders.
Defendants aggressively pushed traders to take part within the referral program and to solicit household and mates to take a position.
Defendants promised traders that they might earn extra from the referral program than they did from their membership “returns.”
Though not lined in our evaluation, Da Silva hid his involvement in Forcount by a Boris CEO.
“Salvador Molina” was performed by Spanish actor Nestor Nunez.
The SEC cites Nunez as an older, extra mature wanting actor who lived in Spain”.
Regardless of being introduced as Forcount’s CEO, Molina “had no management over Forcount, and no related crypto asset experience”.
According to having a Boris CEO, Da Silva integrated Forcount as a Panamanian shell firm.
Supposed Forcount places of work in Brazil had been, as one investor who travelled there described, “had been dressed as much as seem like Forcount’s workplace however had been faux.”
Forcount started to break down in mid 2019. This prompted a reboot a Weltsys and Mindex shitcoin exit-scam.
Da Silva exercised full management over compensation for the referral program. It modified often at Da Silva’s course—with various ranges, bonuses, and prizes.
On a number of events, Da Silva blocked promoters from incomes extra factors or took away factors, and switched the crypto property that factors had been purportedly incomes.
Da Silva additionally usually modified the cost construction, making it unpredictable.
All in all Forcount took in over $8.4 million. Like each MLM Ponzi scheme, nearly all of invested funds was misappropriated by Da Silva and promoters, who spent it on “properties, dozens of automobiles, and luxurious items”.
Forcount advertising movies showcased Da Silva’s ill-gotten property in Brazil and Florida.
Da Silva took movies showcasing his extravagant spending and property throughout this time interval, together with, all in Brazil: two personal jets, two helicopters, dozens of luxurious automobiles, and a seaside mansion with a heliport, in addition to, in Florida, one other mansion.
In a single video from Could 2019, (Da Silva) sarcastically “thanked” Forcount traders — who had been informed Forcount would contribute some portion of its earnings to a charity — for contributing to a “charitable fund” that had allowed him to purchase a Lamborghini.
At Forcount advertising occasions, extra luxurious automobiles had been rented and used to lure new traders in.
At varied occasions held in 2018, Tacuri, Perez, and Coronado every confirmed off borrowed, leased, or rented automobiles that they falsely claimed to have bought with funding proceeds generated from their memberships, together with from the referral program.
On the course of Coronado and Perez, certainly one of their Forcount downline was instructed to lie about how a lot they had been making every month.
In or round mid-2018, Coronado and Perez requested one downline promoter (“Promoter 1”) to supply a testimonial at an in-person occasion, and directed her to state she was making upwards of $20,000 per thirty days.
From then on, Promoter 1 gave testimonials roughly each different month, and Coronado and Perez usually launched her as making over $20,000 per thirty days. Coronado and Perez knew these statements about Promoter 1 had been false.
Additionally, in late 2018, Coronado took a video of Promoter 1’s dwelling, and confirmed this video at promotional occasions, claiming that Promoter 1 had been capable of buy it along with her Forcount compensation.
Coronado knew that Promoter 1 didn’t personal the property and was renting the home and that these statements had been false.
Ticketed raffles at Forcount occasions had been additionally rigged;
At a promotional occasion in Cancun, Mexico, in or round October 2019, Da Silva bought raffle tickets for a automobile.
When Da Silva was unable to promote sufficient raffle tickets, he determined to attract a fictitious quantity in order that he might maintain the proceeds.
“Promoter-1” isn’t named however is believed to have cooperated with the SEC as a part of their investigation. At one level Perez disclosed to Promoter-1 that Forcount was in actual fact a Ponzi scheme.
By the top of 2019, Promoter 1 famous to Da Silva, Tacuri, and Perez that Promoter 1 was receiving many complaints from their downline traders who had been unable to make withdrawals.
Perez informed Promoter 1 to take new traders to an upcoming Forcount occasion deliberate for January 2020.
Perez mentioned that with the cash raised from new traders, Da Silva might pay the sooner traders.
By providing passive returns to traders…
When selling Forcount memberships, promoters, together with Perez, Tacuri, and Coronado, informed traders that they may count on their funding to double in six to eight months.
Tacuri’s “guidelines” for investing in Forcount (had been) “create a free account, make investments, invite mates, double up, and repeat the method.”
…Forcount’s funding alternative constituted a securities providing.
The Forcount memberships had been funding contracts and due to this fact securities, as a result of traders made an funding of cash in a typical enterprise with an inexpensive expectation of earnings from the efforts of Defendants or third events.
Defendants provided and bought these securities with out registering their gives or gross sales with the Fee or qualifying for an exemption from registration.
Neither Forcount, Da Silva or any of Forcount’s promoters had been registered with the SEC.
As such the Forcount defendants have been charged with securities fraud violations of the Securities and Alternate Act throughout three counts.
Of the ~$8.4 million Forcount took in
- Francisley Valdevino Da Silva is alleged to have misappropriated $4.9 million;
- Juan Antonio Tacuri Fajardo is alleged to have misappropriated $1.3 million; and
- Ramon Antonio Perez Arias and Jose Ramiro Coronado Reyes are alleged to have misappropriated $1 million, which they cut up equally.
I can’t converse to Perez however after Forcount and Weltsys, Jose Coronado continued to defraud shoppers by MLM crypto Ponzi schemes.
In April 2021 BehindMLM inadvertently tied Jose Coronado to the BNB Revenue Ponzi scheme.
Coronado re-partnered up with Juan Tacuri to proceed defrauding shoppers by the OmegaPro Ponzi scheme.
The SEC is searching for a everlasting injunction towards the Forcount defendants, in addition to disgorgement of ill-gotten positive aspects and a civil financial penalty.
Whereas the SEC’s litigation towards Forcount’s prime promoter’s appears simple, how the case towards Da Silva will progress is unclear.
Da Silva is believed to be in custody in Brazil. He’s accused of defrauding Brazilians out of at the least $800 million by varied cryptocurrency schemes.
Regardless of being indicted within the US on associated legal fees, Da Silva being a Brazilian nationwide means he received’t be extradited.