A Fairburn man previously banned from selling investments in Georgia was caught promoting a multilevel marketing scheme that lured investors with promises of massive returns, according to state regulators.
Georgia Secretary of State Brad Raffensperger’s office this month issued a cease-and-desist order against Eric Ture Muhammad, who had been hit with another order in January for his alleged involvement in a similar scheme.
Muhammad, who describes himself on LinkedIn as “The Wealth Minister,” was also slapped with a $500,000 civil penalty. Regulators say he has not paid his share of a penalty the state issued in its January order.
The most recent order centers on Muhammad’s role promoting Trage Technologies, a Panama-based company registered in the Marshall Islands that marketed cryptocurrency investments.
Regulators say Trage promised to more than quadruple investors’ money in a year’s time with what it described as a surefire crypto-trading algorithm. The company allegedly structured its payouts to encourage investors to recruit more people in what Georgia regulators called a multilevel marketing program.
The state says Trage pulled down its website this month and locked out investors out of their accounts, essentially freezing their assets.
A call to a Chinese phone number which Trage had previously provided the U.S. Securities and Exchange Commission went unanswered.
Since beginning operations earlier this year, Trage allegedly transferred some $79 million to unidentified accounts, which the Secretary of State’s Office says raises concerns about potential fraud. Regulators in California have described the company as a “crypto scam” and a “fraudulent pyramid and Ponzi scheme.”
Georgia investigators questioned Muhammad in June about his role promoting the investments. According to the state’s order this month, he would not answer questions about deposits he received from investors. And when they told him they believed he was using investor funds to pay his son’s tuition, he ended the call and stopped responding to their messages, the order says.
Muhammad could not immediately be reached for comment Monday.
Regulators say Trage and Muhammad claimed to be operating within the law when they weren’t.
According to the order, Trage said it was registered with the SEC, but it was not. Instead, it claimed an exemption from SEC rules it allegedly wasn’t eligible for.
Meanwhile, Muhammad allegedly told investors on a webinar that he was no longer subject to a cease-and-desist order in Georgia.
In fact, regulators say, he was. Muhammad was banned from working in the securities industry in Georgia in January after he was accused of marketing investments without registering with the state.
The Secretary of State’s Office says its investigators have linked Muhammad to “several pyramid schemes and Ponzi schemes” since then.
On the same call with investors, regulators say Muhammad boasted to investors about how he’d brushed them off. He claimed he told authorities, “It will be a good day in hell before you get anything out of me so much as a dime or so little as a penny.”
The Secretary of State’s Office says that, too, was a lie.
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