A class action lawsuit filed in a federal court in the United States accuses banking behemoth JPMorgan Chase of having a part in a cryptocurrency-related Ponzi scheme that allegedly raised around $328 million in investments.
It is stated in the lawsuit that the scheme, which was associated with Goliath Ventures, managed to lure thousands of investors with promises of consistent returns through crypto trading strategies.
The legal complaint was filed in the United States District Court for the Northern District of California by plaintiff Robby Alan Steele, who is seeking damages on behalf of investors who allegedly lost funds in the scheme.
The lawsuit, according to the filing, claims the bank processed a large volume of transactions related to the fraud without adequate oversight.
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Court documents indicate that it generated around $328 million from 2,000 investors between 2023 and early 2026. The company assured investors of constant returns every month through cryptocurrency trading strategies and investments in a liquidity pool.
However, it is believed that the company operated a Ponzi scheme, where investors’ funds are used to pay earlier investors while a larger amount is spent elsewhere.
The lawsuit asserts that the money exceeding $250 million linked to the scheme moved through the business bank accounts at JPMorgan Chase Bank. From the accounts, the lawsuit asserts that large transfers were sent to the cryptocurrency exchanges.
These transfers include the cryptocurrency exchange accounts linked to Coinbase and other virtual asset services. The plaintiffs argue that the bank could have detected the unusual patterns of the transactions earlier.
Apparently, only a little amount of investors’ funds was allegedly used for trading cryptocurrency. The rest of the funds were allegedly channeled towards luxury goods, traveling, events, as well as payments that helped to sustain the scam.
The alleged scam started to fall apart after investors started making withdrawals and payments slowed down. The authorities then froze some assets and put the company under receivership to track the flow of funds.
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