CFTC Claims Crypto Assets Are Commodities in Lawsuit Against Ex-Deutsche Bank Investment Banker

The Commodity Futures Trading Commission (CFTC) has filed a civil enforcement action against Rashawn Russell, a former Deutsche Bank investment banker, in the US District Court for the Eastern District of New York.

The filing alleges that Russell fraudulently solicited retail investors to invest in a digital asset trading fund. He is also being accused of defrauding investors of nearly $1 million in the process. He is being charged with one count of wire fraud by the CFTC.

The Lawsuit According to the press release, Russell asked retail investors to contribute Bitcoin, Ether, and fiat currency to invest in his purported proprietary digital assets trading fund from November 2020 through July 2022. He allegedly guaranteed that investors would not sustain any losses. In some cases, the banker also promised a minimum 25% return on investment.

The complaint charged Russell with intentionally and/or recklessly making false and misleading statements regarding the structure, size, and performance of the fund. He is also accused of making false promises to pay withdrawal requests, as well as to compensate investors in USDC.

The funds were then used to pay for Russell’s personal expenses, entities tied to gambling activities, as well as Ponzi-like payments to current investors.