Emerson Pires, Flavio Mendes Goncalves and Joshua David Nicholas have been indicted.
Criminal charges filed against the trio pertain to the EmpiresX Ponzi scheme.
EmpiresX was a typical MLM crypto trading bot Ponzi, launched in 2020.
As per an indictment returned by a Grand Jury on June 30th;
Emerson Pires and Flavio Mendes Goncalves aggressively marketed EmpiresX to prospective investors as a lucrative investment opportunity.
Pires, Goncalves and Joshua David Nicholas falsely and fraudulently touted EmpiresX’s purported investment platform involving trading bots and private investment as a simple, safe, and flexible choice to invest cryptocurrency and fiat currency.
Pires, Goncalves and Nicholas offered and sold the EX BOT as a series of transactions or schemes because they promoted the EX BOT as an investment of money into a common enterprise with other investors, with the reasonable expectation of profits from the efforts of EmpiresX.
The EX BOT therefore qualified as a “security” under the rules and regulations governing the offer and sale of securities in the United States and required registration with the SEC.
Despite representations to the contrary, Pires, Goncalves and Nicholas never registered, nor took steps to register, EmpiresX’s investment program involving the EX Bot as an offering and sale of securities with the SEC, nor did they have a valid exemption from this registration requirement.
To disguise and conceal investors’ funds, and the fact that EmpiresX was not independently generating meaningful revenue through the EX BOT, Pires and Goncalves laundered investors’ funds generated in the United States and elsewhere through EmpiresX’s cluster of cryptocurrency wallets, Foreign Cryptocurrency Exchange 1, and elsewhere.
In total, EmpiresX frauduelnt obtained approximately $100 million from victim investors.
Pires, Goncalves and Nicholas also diverted investors’ funds to cover personal expenditures, including exotic vehicles, clothing from high-end retailers, and attorney’s fees.
The indictment charges Pires, Goncalves and Nicholas with
- one count of conspiracy to commit wire fraud;
- one count of conspiracy to commit securities fraud; and
- one count of conspiracy to commit international money laundering (Pires and Goncalves).
The DOJ is seeking forfeiture of ill-gotten gains and convictions.
- Emerson Pires and Flavio Goncalves are facing 45 years in prison and a fine of up to twice what he stole
- Joshua Nicholas is facing 25 years in prison and a fine of up to twice what he stole
The day after the EmpiresX indictment was filed a sealed filing was made on July 1st.
SYSTEM ENTRY – Docket Entry 2 restricted/sealed until further notice.
I believe this might pertain to arrest warrants.
Upon learning they were being investigated by US authorities, Pires and Goncalves, both Brazilian citizens, fled to Brazil. Brazil does not extradite its citizens.
Joshua David Nicholas is a US citizen and resident of Florida.
Pending updates to the case docket, the current status of all three EmpiresX defendants is unknown.
Pires, Goncalves and Nicholas have also been separately sued by the SEC and CFTC on related charges.