A US federal judge in Virginia has sentenced the chief executive of Praetorian Group International to 20 years in prison for running a $200 million cryptocurrency investment scheme that defrauded tens of thousands of investors.
Ramel Ventura Palafix, 61, a dual U.S. and Filipino citizen, was convicted of wire fraud and money laundering in what prosecutors described as a Ponzi scheme that falsely promised returns of up to 3 percent a day from bitcoin trading, according to the Justice Department.
The U.S. Attorney’s Office for the Eastern District of Virginia said investors poured more than $201 million into PGI between December 2019 and October 2021, including at least 8,198 bitcoins (BTC) worth about $171.5 million at the time. According to prosecutors, victims lost at least $62.7 million.
The sentence ends a criminal case brought by the DOJ and follows a parallel civil action by the Securities and Exchange Commission, which marks one of the largest crypto-related fraud cases in recent years by the number of investors and funds involved.
False commercial claims and luxury spending
The court filing states that Palafox told investors that PGI was engaged in large-scale bitcoin trading capable of generating consistent daily profits.
However, prosecutors said the company was not trading at a level that could support the promised returns. Instead, funds from new investors were used to pay off earlier participants.
Officials said Palafox operated an online portal that falsely displayed consistent profits, giving investors the impression that their accounts were growing. It also used a multi-level marketing structure, offering referral incentives to recruit new members.
The DOJ said Palafox spent millions in investor funds on personal expenses, including $3 million on luxury vehicles, $6 million on homes in Las Vegas and Los Angeles, and millions of dollars on penthouse suites and high-end retail purchases.
Authorities said he also transferred at least $800,000 and 100 BTC to a family member.
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Civil charges and international access
The scheme began to unravel when regulators scrutinized PGI’s trade claims and fund flows.
In April 2025, the Securities and Exchange Commission filed a civil complaint alleging that Palafox misrepresented PGI’s Bitcoin trading activity and used funds from new investors to pay early participants.
The complaint states that PGI promoted an AI-powered trading platform and guaranteed daily returns despite the lack of profitable trading operations.
Federal prosecutors in the Eastern District of Virginia later unsealed criminal charges charging Palafix with wire fraud and money laundering stemming from the same conduct.
Authorities seized the company’s website in 2021, and related operations were shut down in the UK, prompting cross-border enforcement scrutiny before the US criminal case moves forward.
The DOJ said victims may be eligible for compensation and directed them to visit the U.S. Attorney’s Office website for information on filing a claim.
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