The DOJ Has Charged an Executive in Connection With a Cherry Picking Scheme

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Last Updated on October 13, 2023 by Bitfinsider

On Thursday, a former CEO pled guilty to a “cherry-picking scheme” involving crypto futures contracts, according to authorities.

The allegations were the first of their sort in a case against Peter Kambolin, the owner and CEO of Systematic Alpha Management LLC, according to the Justice Department. Kambolin, 48, was the owner of the company, which authorities allege advertised algorithmic trading tactics involving futures contracts.

Prosecutors allege that between January 2019 and November 2021, Kambolin engaged in a “cherry-picking scheme” in which he “fraudulently allocated profits and losses from futures trades” in order to “benefit his own accounts unfairly at the expense of his clients.” The term “cherry-picking” refers to the practice of executing trades without allocating them to a specific account until the individual determines whether the trade has been lucrative or has experienced losses.

Kambolin cheated investors in the United States and around the world by depriving them of profitable transactions and utilizing the money to cover personal costs like rent for a beachfront condominium. According to the Justice Department, he transferred monies to international accounts owned by Belarus and Dominica.

Kambolin entered a guilty plea to conspiracy to conduct commodities fraud and faces up to five years in jail.

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