Case Studies
J.S. Held Acquires GLI Advisors, Strengthening Our Construction Project Support Services in the Western US and Hawaii
Read MoreThe Commodity Futures Trading Commission (CFTC) filed a complaint alleging that EminiFX purported to be an online investing platform for cryptocurrency and foreign exchange, operating as a “Ponzi-like scheme” and pooling together investments worth at least $59M from hundreds of investors. The Receiver was appointed over EminiFX and assets traceable to EminiFX customer funds. The FBI executed a search warrant on the EminiFX premises. J.S. Held arrived on-site to collect and preserve crucial data systems, and the Receiver took control of EminiFX.
Since then, our team and the Receiver have endeavored to secure EminiFX’s assets, preserve the books and records outside the FBI’s custody, and conduct a detailed assessment of its financial condition. Analysis of the computer servers hosting the EminiFX platform and certain offshore financial records revealed that over 62,000 EminiFX users collectively invested approximately $250M, primarily via cash deposits in the United States or cryptocurrency deposits made through an Estonian exchange.
Our engagement began with collecting multiple communication sources (including Slack) and financial documents, comprising dozens of unique custodians and hundreds of disparate electronic data sources and physical evidence. Approximately one million documents were put through the discovery process as part of the investigation. During the early stages of the Receivership, our team and the Receiver dedicated significant time and resources to reviewing the records available to identify and analyze transactions (deposits and withdrawals) made by users to and from the EminiFX system, including cryptocurrency transactions.
The project eventually pivoted into a formal process to determine the universe of people who may be entitled to a distribution from the EminiFX receivership estate, including those individuals or entities who deposited funds with EminiFX for investment purposes.
Our team processed all the documents into an eDiscovery review platform; developed targeted content and metadata searches to identify key communications and financial statements; and used digital forensics tools to collect, track, and store physical evidence. We also performed data validation procedures and various transaction analyses to trace the flow of funds and calculate account balances.
Overall, we processed and analyzed over 110,000 transactions across multiple financial institutions and cryptocurrency exchanges. These transactions represented over $260M in deposits and $34M of withdrawals affecting over 62,000 investors. The Receivership recovered over $151M in assets, which will be distributed among the investors based on our ability to calculate and validate their claims.
Ken Feinstein
Managing Director
Digital Investigations & Discovery
+1 917 277 7868
[email protected]
Mike Gaudet
Managing Director
Digital Investigations & Discovery
+1 346 509 5373
[email protected]
Paula Durham
Director
Strategic Advisory Practice
+1 602 279 7505
[email protected]
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