Komal Joshi · Oct 21, 2020 . 6min read
U.S DOJ indicts five for Cryptocurrency Mining Fraud
The U.S Justice Department claims the defendants laundered at least $20 million of the proceeds in the scheme.
By Victor Ugochukwu · Sep 7, 2020 . 6min read
The United States Department of Justice – DOJ in an unsealed document indicts five for their roles in a cryptocurrency mining investment fraud. The DOJ charged Pablo Renato Rodriguez, Gutemberg Dos Santos, Scott Hughes, Cecilia Millan, And Jackie Aguilar for allegedly operating a money-laundering ring and defrauding individuals through investments in AirBit Club, a purported cryptocurrency mining and trading company.
The DOJ in a press release details on how the group coordinated and defrauded victims in the scam ring. This, however, started sometimes around in 2015 even before the 2017 bull run.
From investigations carried out, Rodriguez and Dos Santos are the owners of AirBit Club. The duo together with Millan and Aguilar were also active promoters of the investment packages. They promised investors passive income for their investments.
DOJ alleges the Ponzi operators travelled extensively promoting their Cryptocurrency Mining Fraud
Four of them travelled around the four continents. This included the United States, Latin America, Asia and Eastern Europe. They hosted luscious seminars encouraging people to invest in AirBit packages. The operators also furnished victims with an AirBit Club portal which accumulated purported profit. However, as the DOJ proves, the profit representations were a fraud. There was no underlying trading and cryptocurrency mining activity to support the claims. Instead, the five spent their victims’ money on luxury cars, jewellery, and homes. They also used proceeds from the Ponzi to finance more extravagant expos to recruit more victims.
The DOJ also uncovered how the operators of the Ponzi scheme tried to conceal their guilt by asking for deposits from investors in cash.
RODRIGUEZ, DOS SANTOS, HUGHES, and MILLAN sought to conceal the AirBit Club Scheme, as well as their respective control of the proceeds of that Scheme, by requesting that Victims purchase memberships in cash, using third-party cryptocurrency brokers, and by laundering the Scheme’s proceeds through several domestic and foreign bank accounts, including an attorney trust account managed by HUGHES (the “Hughes Trust Account”).
The Department of Justice claims the defendants laundered at least $20 million of the proceeds in the scheme. Consequently, Rodriguez, Dos Santos And Millan were charged with conspiracy to commit wire fraud. They were also slammed with conspiracy to commit bank fraud and money laundering. They face maximum sentencing of 20 to 30 years if found guilty.
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