WASHINGTON — The Commodity Futures Trading Commission today announced the U.S. District Court for the Middle District of Florida entered a default judgment against defendants Brian Early and Alisha Ann Kingrey for their participation in a digital assets and precious metals fraud involving the unincorporated Fundsz entity and its website. Entry of the default judgment was preceded by the court’s entry of consent orders against two other defendants for their roles in the scheme: Rachel Larralde, as personal representative of the estate of Rene Larralde, and Juan Pablo Valcarce.

In entering the default judgment against Early and Kingrey, the court found that, as Fundsz board members and social media moderators, they made material misrepresentations and omissions concerning Fundsz’s expected profits, risk of loss, and historical trading performance. They also falsely represented that participants’ money would be traded according to a proprietary algorithm and could be withdrawn in 180 days with interest. The court further found that when Early and Kingrey learned of the CFTC’s investigation, they began walking back their profitability claims and worked to eliminate Fundsz’s social media presence. 

The court ordered Early and Kingrey to pay $15,732,455 in restitution and a $15,752,455 civil monetary penalty. The court also permanently enjoined them from further violations of the Commodity Exchange Act and CFTC regulations, as charged, and imposed permanent registration and trading bans.

Separately, when entering consent orders against Larralde and Valcarce, the court found that Rene Larralde, Fundsz’s founder and controlling person, and Valcarce had deceived participants into investing in Fundsz. The court also found that Larralde had misappropriated funds for personal use. 

The court ordered Larralde’s personal estate representative to relinquish ownership rights in a personal residence that Larralde purchased with investor funds, as well as more than $2.7 million in other assets, to the court-appointed receiver.

The court also permanently enjoined Valcarce from further violations of the Commodity Exchange Act and CFTC regulations, as charged, and imposed permanent registration and trading bans.

The default judgment and consent orders resolve all remaining claims in the CFTC’s action. [See CFTC Press Release No. 8766-23.]