Eddy Alexandre: Exploiter of the Faithful

If you are by any chance a member of the Adventist community, as well as being a Forex trader, Eddy Alexandre is a name you know well.

During the time that Alexandre ran his Forex scam, he managed to con around 25,000 investors for his own profit.

Read on to learn the story of Eddy Alexandre and EminiFX, including exactly how he cheated his investors, and how he eventually was forced to pay the consequences for his actions.

Who is Eddy Alexandre?

Eddy Alexandre is the notorious scammer behind a platform called EminiFX. At the time he was convicted of his crimes, he was living in New York, though he was originally from Haiti. In fact, he remains a citizen of Haiti, and not the United States.

Indeed, much of what made Alexandre so pernicious was the deep roots he had in the Haitian community, as well as his influence over members of his Adventist church. Quite a few of the people he would ultimately swindle out of their hard-earned money were Black, like him. In short, he targeted and exploited members of his own minority demographic, using their trust in him to drain them of their finances for his personal gain.

The EminiFX scam: "Never less than 5%[,] never more than 9.98%!!!"

Like many other modern Forex scams, Alexandre's scheme involved both Forex and cryptocurrencies. He created a trading platform called EminiFX, which featured a proprietary trading system for both Forex and crypto. He referred to this platform as an "investment club," and invited people from his community to take part in it.

During the investigation into EminiFX, the FBI took a photograph of a whiteboard at the firm's office. It said: "Never less than 5%[,] never more than 9.98%!!!"

It is unclear from the Washington Post article where we read this whether this whiteboard was on display to customers, or whether it contained an internal memo to the staff for the "results" they were supposed to be generating (or perhaps it was Alexandre's own memo to himself).

Alexandre did tell investors they were getting 5%, though. In fact, he promised they would get 5% from their investments every week, which would lead to them doubling their money inside of five months. This would be possible, he claimed, through the use of what he called a "Robo-Advisor Assisted account."

What makes cons work is usually the exploitation of either trust, or desperation. There is a good chance that many of the people Alexandre scammed knew on some level that these promises were unrealistic. But they still fell for them—perhaps because they knew him through the church, or trusted him as a fellow Haitian.

That said, quite a few Forex traders are very unrealistic in their own expectations, and really have no idea what constitutes an unworkable claim. They really do think that it is possible to reliably earn 5% each and every week, and that someone making such a promise is not being unreasonable.

Any time you see someone promising you certain returns, as Alexandre promised 5% to his investors, run the other way. They are out to steal your money.

In fact, you should be wary if you do not see a Forex firm go out of its way to remind you that "past returns do not guarantee future outcomes."

Alexandre's position of trust

Alexandre was not just a random churchgoer. He was a chaplain at the at Maranatha Seventh-day Adventist Church in Queens. People who attended the services at which he preached were used to turning to him for wisdom, advice, and comfort.

Simply by reaching through the network of his church, he was able to rope the vast majority of his victims into his Forex scam.

People turn to religion for many reasons, but for quite a few, faith is something to turn to in times of fear, fatigue, and desperation.

Alexandre was quite cunning to target this group, both because he held a position of trust, and because he knew that many people attending the church were emotionally vulnerable.

How the EminiFX scam worked

Obviously, Alexandre was not really earning 5%, and his investors were not earning 5% either over the long run.

Alexandre did invest some of the funds he was given, but he lost money on those investments. He did not inform the investors that their funds had been lost.

What about the rest of the funds that investors entrusted to him? That money went straight to his own personal bank account, to the tune of $14,700,000.

More details on how Alexandre's scam worked are available to read in The Haitian Times. Some of the numbers are astonishing. For instance, he originally had around $9 million in funds from his customers. But he managed to lose $7 million of those funds in only four months. At no point were the investments profitable.

While most of the "investing" activities concerned Forex, there were some investments in Bitcoin as well, subject to that crypto's volatility.

What is less widely discussed is that EminiFX was involved with real estate as well. Not surprisingly, this was also on Long Island, where Alexandre purchased his home with stolen funds. Through his firm, he contracted to buy 46 properties that were under foreclosure. But none of those contracts ever converted into sales.

As for what he did with the stolen funds, the answer is "the usual." Like many other fraudsters, Alexandre was unable to resist the allure of an opulent lifestyle. In particular, he enjoyed automobiles, using investor funds to pay off his Mercedes Benz and to purchase a brand-new BMW.

In addition to those vehicles, he decided to upgrade his living appointments, purchasing a home on Manhasset, Long Island, for $4.8 million.

Summary of losses and expenses

Here is a quick breakdown of EminiFX's losses and expenses:

• Over the course of several months, EminiFX spent $6 million on operations overhead. These costs included rent, vehicles, equipment, and salaries.
• The losses in the company's crypto account eventually added up to $40 million.
• The total amount of losses for the company including those above as well as the losses in the Forex brokerage company and real estate come out to around $300 million.

EminiFX functioned as a Ponzi scheme

Naturally, for a scheme like this to work for any length of time, customers need to be able to make withdrawals. Otherwise, they would become suspicious. How did EminiFX process $33 million in withdrawals during the time of its operation? The answer is by operating as a Ponzi scheme.

If you make a withdrawal from a legitimate trading platform, you are either removing the money you originally put in your account or profits if your account shows gains.

But with a fraudulent platform like EminiFX that works as a Ponzi scheme, when you make a withdrawal, what you actually are taking out is the money that other people put in. And when they make withdrawals, they likewise are drawing funds from other users' accounts, such as yours.

The Haitian Times explains that what made this Ponzi scheme possible was the CoinPayments account that the firm was using to process Bitcoin withdrawals to investors:

Once Bitcoin hit the CoinPayments system, it became one part of one large EminiFX account, like pouring a glass of water into a big lake. So when a user withdrew, it was like taking a small little glass of water from that very big lake.

However, the lake in this analogy was made up of contributions only. So when users withdrew over $33 million, as they did, that $33 million came from the CoinPayments account. And it came not from any trading profits, but from the $182 million that other users have contributed via CoinPayments.

A nine-year prison sentence

Thankfully, Eddy Alexandre did not get away with stealing from his community indefinitely. The law finally caught up with him.

Following an FBI investigation into EminiFX, Eddy Alexandre was arrested and put on trial for his crimes. In February, 2023, he plead guilty in exchange for a plea deal. During the trial, he said that he regretted what he had done, and intended to make amends with his victims.

He was sentenced to nine years in prison, which is one year less than the maximum the plea deal would have allowed.

Following Alexandre's sentencing, U.S. Attorney Damian Williams said:

Eddy Alexandre defrauded tens of thousands of ordinary investors of almost a quarter-billion dollars in his cryptocurrency investment scam. Alexandre's fraud was brazen and included fabricating weekly investment returns of at least 5% out of thin air and falsely claiming to use artificial intelligence trading technology that did not even exist.

Most egregiously, Alexandre recruited many of his investors by exploiting his position of trust within his church and the Haitian community, even going so far as to enlist members of the church to help recruit EminiFX investors. As today's sentence demonstrates, cryptocurrency executives who lie and cheat their customers will be held to account for their crimes.

Are there any updates on Eddy Alexandre?

On September 6, 2023, The Haitian Times reported that Eddy Alexandre was behind bars, serving the start of his prison sentence at FCI Allenwood Low in Allenwood, Pennsylvania. The facility is low-security. Assuming he serves his full sentence, he will be released on April 9, 2031.

Will investors ever get back their funds? Adventist Today reports:

On September 6th, a Town Hall meeting was held by David Castleman, the court-appointed receiver tasked with recovering and returning funds seized from EminiFX. In the meeting via YouTube, he explained in great detail what made the situation fraudulent and shared how his team had been able to recover $153.7 million for investors.

While investors still aren't sure when they will receive the entirety of stolen funds, Castleman and his team are focused on transaction reconciliation and the claims process for the foreseeable future, with a distribution plan to follow, subject to court approval.

Final takeaways

What have we learned from the case of Eddy Alexandre and EminiFX? Let's review:

• If someone guarantees you returns of any sort from Forex, crypto, or other types of investing, you are looking at a scam. No one can promise you 5% or any other amount.
• When someone is trying to sell you on an investment prospect that sounds too good to be true, you should be wary, even if they are in a position of trust or authority, and even if they are a member of your community.
• Be mindful of how your own emotions may steer you when you are dealing with scammers. Desperation can make it easy for us to believe offers we should not believe.
• Being able to withdraw money from your account is reassuring. But in and of itself, it does not prove you are not getting scammed.

It certainly was no one's fault but Eddy Alexandre's that these 25,000 investors were robbed. Nevertheless, each of those investors learned a painful, but valuable lesson. You have a chance to learn that lesson the easy way. By keeping the above tips and advice in mind, you can avoid becoming a victim of the next Forex scam similar to EminiFX.

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