Cryptocurrency Company CLS Global Pleads Guilty in Market Manipulation Case
CLS Global, a United Arab Emirates-based cryptocurrency financial services firm, has agreed to plead guilty to charges related to market manipulation of a digital token created by the FBI. The plea comes after a federal undercover investigation known as "Operation Token Mirrors."
In this operation, the FBI created a digital token and a fake cryptocurrency company to expose fraud in the crypto market. CLS Global was one of three companies and 15 individuals charged in the investigation.
Prosecutors allege that CLS Global provided illicit trading services to cryptocurrency companies and agreed to manipulate the market for NexFundAI's token, which was operated on the Ethereum blockchain. The company admitted to engaging in sham transactions known as wash trading, which artificially inflated the token's trading volume and price.
As part of its plea agreement, CLS Global will plead guilty to two counts related to fraudulent manipulation of cryptocurrency trading volume. The company will also pay a fine of $428,059 and be barred from participating in cryptocurrency transactions on platforms available to U.S. investors or providing services to U.S. cryptocurrency clients.
Additionally, CLS Global has committed to annual certifications about its business practices and has agreed to settle related civil charges by the U.S. Securities and Exchange Commission.