The Expert the CFTC Hired Said It Was Not a Ponzi

In a Ponzi scheme, early investors are paid with money from later investors. There is no underlying investment. The fund is a fiction sustained by new capital until it collapses.

The CFTC called Rose City Income Fund a Ponzi scheme. The CFTC then hired StoneTurn Group, one of the most respected forensic accounting firms in the country, to prove it.

StoneTurn looked at the blockchain.

What they found was the opposite of a Ponzi. The fund held 885 documented on-chain transactions. Every purchase of Ethereum-based tokens was recorded immutably on the public ledger. Every sale was recorded. Every redemption was recorded. $134.9 million purchased. $130.4 million sold. 126 receive transactions returning ETH to investors. The math was transparent, verifiable, and public — available to anyone with an internet connection and a willingness to look.

StoneTurn's conclusion, filed as Dkt. 272-1: a Ponzi scheme was mathematically impossible.

The CFTC received this report. The CFTC read this report. The CFTC continued the prosecution anyway.

This is not a case where the government made an honest mistake and corrected it when new evidence emerged. This is a case where the government's own hired expert produced evidence that directly contradicted the government's theory — and the government chose to ignore it.

The lead investigator, Heather Dasso, admitted under oath that she had not looked at the blockchain before filing the case (Dkt. 250-2). She did not look at it during the raid on May 16, 2022, when Sam Ikkurty showed her the live Etherscan ledger. She did not look at it before obtaining the $209 million summary judgment.

The blockchain was always there. It is immutable. It cannot be altered, hidden, or destroyed. Every transaction that ever occurred in this fund is publicly visible at this moment on Etherscan.

The CFTC chose not to look. Then they hired an expert who did look. The expert said it was not a Ponzi. The CFTC proceeded anyway.

The full StoneTurn report summary, the blockchain transaction ledger, and the Dasso deposition are all available at samikkurty.com. Read them. Verify them yourself. The blockchain does not lie.