The Commodity Futures Trading Commission has initiated a civil enforcement action against Francier Obando Pinillo, a pastor from Washington State, for allegedly running a deceptive multilevel marketing scheme involving digital assets.

The scheme, operated through entities named ‘Solanofi’, targeted more than 1,500 individuals, mainly Spanish-speaking members of Pinillo’s congregation in Pasco, Washington.

Reportedly valued at $5.9 million, the scheme promised participants guaranteed returns of up to 34.9% monthly by claiming to operate a risk-free leveraged staking platform for cryptocurrency trading.

However, as stated by the CFTC, no such platform was ever in existence, no trading took place, and all customer funds were misappropriated.

Pinillo’s crypto misconduct

Pinillo leveraged his position as a trusted pastor to gain the trust of his victims, many of whom had limited knowledge of cryptocurrency and trading. Identifying himself as the CEO of the Solanofi entities, Pinillo convinced clients that the platform’s automated system could yield remarkable returns through cryptocurrency transactions.

To maintain the illusion, Pinillo supplied customers with fabricated online account statements and offered referral bonuses of 15% to induce others to participate in the scheme. These maneuvers effectively established a Ponzi-like structure, utilizing funds from new investors to pay fictitious returns to earlier ones.

The CFTC’s complaint against Pinillo alleges that he failed to disclose critical information in his solicitations, including the absence of a legitimate trading platform, falsified account evidence, and the misappropriation of client funds.

Payments that were claimed as profits were, in reality, sourced from misappropriated assets. The CFTC is pursuing restitution for defrauded clients, recovery of funds, civil penalties, and a permanent trading ban on Pinillo.