EminiFX Receiver reports cash receipts of $65 million for 2022
The Receiver of EminiFX, Inc has published the 2022 Annual Status Report.
Throughout 2022, the Receiver and his team have continued their efforts to recover and preserve the assets of EminiFX, Inc., as well as the assets of Defendant Eddy Alexandre traceable to customers of EminiFX, per the Consent Order.
In 2022, cash receipts by the Receivership totaled nearly $65 million, primarily from the turnover of frozen funds ($60.9 million), as well as from the liquidation of vehicles and office equipment ($0.3 million), the recovery of various deposits from third parties ($3.3 million), and interest earned on the cash deposits ($0.3 million).
Cash expenditures, for certain court-approved pre-receivership expenses as well as post-receivership approved professional fees and expenses, totaled less than $2 million, leaving a net cash balance of approximately $63 million at the end of 2022.
In addition to the above cash receipts, the Receiver also recovered a substantial amount of digital assets (i.e., cryptocurrency), worth over $61 million at the end of 2022.
The Receiver will continue to pursue all avenues of recovery. However, based on the current information available to the Receiver, it is likely that the vast majority of the funds that will be available for the Receivership, for the eventual benefit of creditors and defrauded investors, have been recovered.
As noted in prior reports, the initial activities of the Receiver upon appointment were focused on winding down EminiFX as an operating entity and preserving the EminiFX data and records.
The Receiver’s initial decision to wind down EminiFX was based on the lack of any legitimate investing activity that would support the EminiFX returns paid to investors of between 5.00% and 9.99% per week. The prudence of the Receiver’s decision in this regard was demonstrated on February 10, 2023, when, just before the filing of this report, Alexandre pled guilty to one count of commodities fraud in the parallel criminal action arising from similar conduct.
Alexandre also agreed to a Consent Preliminary Order of Forfeiture, which allows for distributions to investors by the Receiver to be applied toward the forfeiture amount. The Receiver expects to include more detail on the impact of Alexandre’s plea on the administration of the Receivership in the First Quarter 2023 Status Report.
The Receiver and his team focused the majority of their forensic effort in 2022 focused on creating accurate financial records for EminiFX and determining the amounts that tens of thousands of individual investors had contributed to—and received from—EminiFX. That analysis has been significantly complicated by the lack of reliable financial records recovered from EminiFX, most notably the lack of a general ledger in any kind of generally accepted accounting format for the more than 100,000 transactions reflected in EminiFX’s bank statements and equivalent records.
The database recovered from EminiFX has, however, been helpful to the Receiver’s forensic accounting team in attributing as many transactions as possible to specific EminiFX users. The reconstruction of these records is expected to be critical to the claims process the Receiver is developing, both in aid of validating the tens of thousands of expected investor claims as well as the Receiver’s planned efforts to minimize, to the extent possible, the burden on investors.
Nevertheless, EminiFX investors should continue to maintain all of their records related to their EminiFX investment, especially those reflecting any deposits or withdrawals.
Victims of EminiFX may consult this website for additional information about the Receivership.