The U.S. Justice system will no longer want to let crypto crimes and frauds go unpunished.
Four dubious ICO, NFT rug pull, and Ponzi pyramid schemes have recently prompted it to indict up to 6 people.
Four crypto fraud cases
According to U.S. DOJ officials:
"These cases are a crucial reminder that some scammers hide behind honeyed words, but at the end of the day, they are simply out to rob people of their money."
Even local elected officials like Senator Kevin Thomas disagree. Thomas wants to give prosecutors a bold crypto legal framework for prosecuting crimes that adhere to the blockchain paradigm while combating fraud. These initiatives are prompting the DOJ to take on the following cases:
1- Baller Ape Club
A Vietnamese man named Anh Tuan started the scam. The Non-Fungible Token (NFT) Baller Ape Club collection is said to be a pure conspiracy behind which lies a crypto-fraud. The project may link to an international money laundering scheme.
The DOJ accuses Anh Tuan of performing an "NFT rug pull" by disintegrating his project's website after filling their briefcases with investors' money. The total amount stolen is $2.6 million. The 26-year-old and his associates face up to 40 years in prison upon conviction.
Authorities say EmpiresX is a "global Ponzi scheme based on cryptocurrencies." a federal grand jury in South Florida indicted Emerson Pires, David Nicholas, and Flavio Gonclaves for bitcoin fraud.
At the root of their indictment; were securities fraud activities that generated $100 million. There is also the fact that they had laundered investor funds via a foreign crypto exchange. They occasionally rewarded the last investors with the proceeds of the first victims.In addition, the proprietary trading bot "EX BOT," which they were praising, was only fictitious.
3- Titanium Blockchain Infrastructure
The fraud started as the Initial Coin Offering (ICO) that allowed the sale of tokens and the accumulation of $21 million in revenue initiated by Michael Stollery, CEO and founder of the company. The United States Department of Justice thinks that white paper forgery occurred. To further entice investors, Titanium's website features phony testimonials. According to the Department of Justice:
"[They] fabricated alleged business relationships [with companies like Apple, Pfizer, and The Walt Disney Company] to create a modicum of legitimacy."
Unfortunately, this dubious ICO has put the Security Exchanges Commission on alert. Someone filed a complaint against its initiators on May 22, 2018.
4- Circle Society
David Saffron, the founder of this company, allegedly solicited investors to participate in an unregistered commodity pool. To convince them, he had to:
Use a trading bot to pull off a cryptocurrency fraud.
Offer investors the trading of their funds for a profit with the support of the same robot
Make people dream with returns of up to 500% and 600%.
"To entice investors, Saffron allegedly held investor meetings at luxury homes in the Hollywood Hills and, in fact, traveled with a team of armed security guards to create a false appearance of wealth and success." U.S. Department of Justice
The hack allowed him to amass $12 million and, unfortunately, 115 years in prison. The heaviest cryptocurrency fraud-related sentence in history? If Cryptocurrency Ruja Ignatova gets caught, she will receive a much more severe punishment than Saffron, knowing she was a hit-and-run offender and stole over $4 billion from investors on ApeCoin. Didn't she make the FBI's "Most Wanted" list?
At the moment, authorities invite the victims of these crypto frauds to come forward to learn more about their rights. But given the abovementioned cases, it is better to double the vigilance. There is no scarcity of professional liars and deceit professionals in cryptocurrency.