US Court orders Kikit & Mess Investments and its owner to pay $31m in penalties

The US federal court has issued a major penalty for Abner Alejandro Tinoco and his company, Kikit & Mess Investments LLC. According to reports, the firm and its owner must pay over $31 million in penalties for running fraudulent forex and crypto investment schemes.

Kikit & Mess and Tinoco to jointly pay $31 million

According to the Commodity Futures Trading Commission (CFTC) statement, Senior Judge David C. Guaderrama of the US District Court for the Western District of Texas issued the order on July 9. The judge ordered Tinoco and Kitkit & Mess to pay $6.2 million to 199 defrauded victims, which will come as a joint payment.

The judge also ordered the company and its owner to pay another $6.3 million in disgorgement, and finally, an $18.8 million civil monetary penalty.

This was not the first time that Tinoco and his firm ended up clashing with the US authorities, however. Previously, the court entered a consent order in March 2022, when the firm and its founder were banned from trading in CFTC-regulated markets, or even registering with the agency.

At the time, the order found the defendants had solicited more than $7.2 million from defrauding clients. The scheme started in September 2020, and it operated in a way that CFTC described as something similar to a Ponzi scheme

The CFTC statement added: “The order found the defendants did not invest their clients’ funds as represented and instead used them to pay Tinoco’s personal expenses including the travel costs for chartering a private jet, the purchase of a luxury mansion and other real estate.”

CFTC warns retail investors to check the firms’ registration status

Tinoco was also involved in a different criminal case where he pleaded guilty to five counts of wire fraud. For this, he was sentenced to 84 months in prison, as of February 2024. Right now, he is serving his sentence at a federal correctional facility in Arizona.

Meanwhile, the CFTC urged the traders and investors to be cautious, and always verify the registration status of any investment firm before they invest their money, whether with individuals or companies.

The cryptocurrency and forex markets are thriving, but this also makes them the prime hunting ground for scammers who seek to deceive retail investors. The CFTC has had many similar cases over the last few months, including FalcinX, as well as the case involving Sam Ikkurty, in which victims of the scam lost $83.7 million.