A federal judge sentenced Ramil Palafox, the founder of Praetorian Group International, to 20 years in prison for orchestrating a Ponzi scheme involving Bitcoin that deceived investors out of more than $200 million between 2019 and 2021.

According to the U.S. Department of Justice, the 61-year-old dual citizen of the U.S. and the Philippines was found guilty of wire fraud and money laundering related to fraudulent promises of daily returns from Bitcoin trading.

From December 2019 to October 2021, investors contributed over $201 million to Palafox’s scheme, with at least 8,198 Bitcoins valued at approximately $171.5 million at the time. Victims of the scheme faced losses totaling at least $62.7 million.

This sentencing wraps up the criminal case initiated by the DOJ and comes after civil actions from the SEC, marking it as one of the significant crypto fraud cases in recent times by investor numbers and the financial magnitude involved.

False Trading Claims and Lavish Spending

Court documents revealed that Palafox misled investors into believing that PGI was conducting extensive Bitcoin trading capable of yielding constant profits. However, it was stated that the company was not trading sufficiently to fulfill the promised returns and utilized funds from new investors to pay older ones.

Palafox operated a website that falsely showcased consistent gains to create the illusion of growing accounts for investors. He also employed a multi-level marketing strategy, incentivizing referrals to attract new participants.

The DOJ disclosed that Palafox lavishly spent millions from the investor funds on personal luxuries, such as $3 million on high-end vehicles, over $6 million for residences in Las Vegas and Los Angeles, and substantial amounts on upscale retail endeavors and penthouse suites.

Additionally, he transferred at least $800,000 along with 100 BTC to a family member.

Civil Actions and Global Implications

As regulations began to examine PGI’s trading claims and financial activities, the SEC filed a civil complaint in April 2025, accusing Palafox of misrepresenting Bitcoin trading operations and misusing new investor funds to settle payments to prior participants.

The complaint asserted that PGI claimed to operate an AI-driven trading platform while guaranteeing daily incomes, despite not engaging in any substantial trading that could justify such profits.

Federal prosecutors in Virginia later unsealed criminal charges targeting Palafox for wire fraud and money laundering stemming from these actions. Authorities also seized PGI’s website in 2021, and operations tied to the business were halted in the U.K., indicating international enforcement actions as the U.S. criminal case progressed.

Victims may qualify for restitution and are encouraged to contact the U.S. Attorney’s Office for more information on filing claims.