Mining Capital Coin preliminary injunction granted
The SEC has secured a preliminary injunction against Mining Capital Coin.
The granted injunction also applies to individual defendants Luiz Carlos Capuci and Emerson Sousa Pires.
The SEC filed suit against the Mining Capital Coin defendants last month. As alleged by the SEC, Mining Capital Coin was a fraudulent investment scheme.
MCC was a Potemkin village for the digital age. There was no mining for cryptocurrency. No trading robots. No trading.
BehindMLM reviewed Mining Capital Coin in 2018, arriving at the same conclusion four years prior.
Following the granting of a Temporary Restraining Order, the court deferred the SEC’s request for a preliminary injunction to Magistrate Judge McCabe.
Magistrate Judge McCabe filed a Report and Recommendation on May 18th, recommending the court adopt the SEC’s motion.
On June 17th the court granted the SEC’s motion for a preliminary injunction.
In the Report and Recommendation, Magistrate Judge McCabe found that the SEC met its burden for a preliminary injunction. This Court agrees.
It is hereby ORDERED AND ADJUDGED that Magistrate Judge McCabe’s Report and Recommendation is ADOPTED and the SEC’s Motion for Preliminary Injunction is GRANTED.
Looking to delay the inevitable, on June 28th Capuci (right) filed a motion requesting the preliminary injunction order be stayed.
The purpose of Capuci’s motion is to stay the Preliminary Injunction pending an appeal to the Eleventh Circuit by Capuci.
Capuci’s appeal is based, not on the merits of the SEC’s case and supplied evidence, but rather on the SEC not having personally served him.
For this Court to grant the preliminary injunction without personal jurisdiction over Capuci, and in doing so fail to address the personal jurisdiction issue squarely presented by Capuci, is reversible error.
Capuci fled to Brazil upon learning of pending charges against him by US authorities. He has since been indicted and remains a wanted fugitive.
Capuci’s motion notes it “will be opposed by the SEC.” Given Capuci’s motion was only filed in the last 24 hours, the SEC and the court have yet to address Capuci’s appeal stay motion.
In related news the DOJ has filed a motion for Alternative Victim Notification.
The motion seeks to overcome Mining Capital Coins use of cryptocurrency to intentionally “conceal the underlying fraud”.
Tracing the fraud proceeds back to each victim has proven nearly impossible.
Once MCC received investors’ funds, it laundered this money internationally through a collection of its cryptocurrency wallets in order to promote and conceal the underlying fraud.
Therefore, by its very design, the scheme has made identifying individual victims with precision nearly impossible.
Moreover, many of the servers with the data for these wallets are located outside of the United States.
Even if investigators are able to seize this data, it will take a great deal of time and resources to review the data and identify additional victims.
It’s a good breakdown of why cryptocurrency has become the defacto method of payment for Ponzi schemes globally.
If the DOJ’s motion is granted they won’t have to contact each Mining Capital Coin victim individually.
If the Court grants this Motion, the Government plans to publish a link on the United States Attorney’s Office for the Southern District of Florida’s website.
The Government will continue to use best efforts to accord standard victim rights to identified victims where possible.
The Government will contact known potential victims and invite them to fill out a victim impact statement on the FBI’s site.
The FBI plans to proactively contact potential victims using email addresses on a MCC investor list that MCC counsel provided to the Securities Exchange Commission (SEC) in the context of the SEC’s civil investigation of MCC.
The FBI will vet the responses to determine who are actual victims, and then enter vetted information into the Victim Notification System.
The court granted the DOJ’s motion on June 15th.
Update 19th July 2022 – Capuci has filed an appeal against the Mining Capital Coin preliminary injunction.
Capuci has also requested the injunction be stayed pending the outcome of his appeal.
The SEC filed its opposition to Capuci’s stay motion on July 8th;
Capuci’s Motion is filled almost entirely of arguments he already made, first in his post-hearing briefing before the Magistrate Judge, and later in his objections to the Report and Recommendation – all of which have already been rejected.
The court acknowledged receipt of Capuci’s Eleventh Circuit appeal on July 14th. A decision on his motion to stay the injunction remains pending.
Update 14th March 2023 – Capuci’s bid to stay the granted preliminary injunction, pending a decision on his appeal, was denied on March 8th.
A ruling on Capuci’s appeal remains pending.
Update 11th August 2023 – Still no decision on Capuci’s appeal.
In the meantime a decision Capuci’s pending Motion to Dismiss or in the alternative stay the SEC’s case was handed down on July 31st.
The court decline to dismiss the SEC’s case but did opt to stay proceedings, pending the outcome of Capuci’s appeal.
In the meantime the previously granted preliminary injunction remains in place.