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The SEC has obtained a temporary restraining order against Mining Capital Coin.
Individual defendants Luiz Carlos Capuci and Emerson Sousa Pires are named in the injunction.
The SEC filed suit against the defendants of Mining Capital Coin last month. Mining Capital Coin, as claimed by the SEC, was a fraudulent investment scam.
MCC is like a digital-age Potemkin village. There was no cryptocurrency mining. No trading robots exist. No trading.
Back in 2014, Some websites reviewed Mining Capital Coin and reached the same result. The court granted a temporary restraining order and referred to Magistrate Judge McCabe’s request for a preliminary injunction. The 18th of May saw the filing of a Report and Recommendation by Magistrate Judge McCabe, suggesting the court accept the SEC’s request.
The court granted the SEC’s application for a preliminary injunction on June 17th.
Magistrate Judge McCabe determined in the Report and Recommendation that the SEC met its burden for a preliminary injunction. This court concurs. It is therefore ORDERED AND DETERMINED that the Report and Recommendation of Magistrate Judge McCabe be ADOPTED and the SEC’s Motion for Preliminary Injunction is GRANTED.
In an effort to delay the inevitable, Capuci (right) filed an application on June 28 demanding that the preliminary injunction ruling be stayed.
Capuci’s motion seeks a stay of the preliminary injunction pending his appeal to the Eleventh Circuit.
Capuci’s appeal is not based on the merits of the SEC’s case and evidence, but rather on the SEC’s failure to serve him personally.
This court committed reversible error in granting the preliminary injunction without personal jurisdiction over Capuci and in failing to address the personal jurisdiction issue raised by Capuci.
Capuci fled to Brazil after discovering that US officials were preparing charges against him. Since his indictment, he has been a wanted fugitive.
The motion by Capuci states that it “will be challenged by the SEC.” Given that Capuci’s request was submitted only 24 hours ago, the SEC and the court have not yet responded to Capuci’s appellate stay application.
In related news, the Department of Justice has requested Alternative Victim Notification.
The proposal aims to counter Mining Capital Coins’ deliberate use of bitcoin to “conceal the underlying deception.”
It has proven nearly impossible to link the proceeds of fraud to each victim.
As a means of promoting and concealing the underlying fraud, MCC laundered investor cash across a collection of its bitcoin wallets after receiving it.
Therefore, by its very nature, the plan has made precise identification of individual victims extremely difficult.
In addition, the majority of the servers containing the information for these wallets are located outside the United States.
Even if police are able to seize this material, identifying further victims will require a significant amount of time and resources.
It is a thorough explanation of why cryptocurrency has become the de facto payment method for Ponzi schemes worldwide.
If the DOJ’s motion is granted, they will not have to individually contact each Mining Capital Coin victim. The government intends to publish a link on the website of the United States Attorney’s Office for the Southern District of Florida if the court grants this motion.
The government will continue to use its best efforts to provide victims with standard victim rights whenever possible.
The government will encourage known prospective victims to complete a victim impact statement on the FBI’s website. The FBI intends to contact prospective victims using email addresses from an MCC investor list that MCC’s legal counsel supplied to the Securities and Exchange Commission (SEC) in connection with the SEC’s civil investigation of MCC.
The FBI will review the responses to establish who the actual victims are, and the information will then be entered into the Victim Notification System.
On June 15th, the court granted the DOJ’s motion.
