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Crypto Fund Supervisor Charged in $5M Ponzi Scheme, Dealing with as much as 30 Years in US Jail

01/30/2021
Crypto Fund Manager Charged in $5M Ponzi Scheme, Facing up to 30 Years in US Prison

A cryptocurrency fund supervisor has been charged in a U.S. federal court docket. He allegedly took over $5 million from traders keen on investing in his crypto funds, promising them excessive returns. In actuality, he was operating a Ponzi scheme and is now going through as much as 30 years in jail.

Crypto Fund Supervisor Arrested for Operating a Ponzi Scheme

The U.S. Division of Justice (DOJ) introduced Tuesday that Jeremy Spence has been arrested and charged in Manhattan federal court docket in a fraudulent cryptocurrency scheme. The 24-year-old from Bristol, Rhode Island, is also called “Coin Indicators.”

Spence is “a cryptocurrency dealer who solicited funds for varied cryptocurrency funds that he operated, with commodities fraud and wire fraud offenses,” the DOJ described, including:

Spence took cryptocurrency value over $5 million from greater than 170 particular person traders after making false representations in reference to these cryptocurrency funds.

U.S. Lawyer Audrey Strauss defined that the defendant “allegedly lured traders to his cryptocurrency funding rip-off by touting returns of as much as 148%.” Nonetheless, his funding swimming pools constantly misplaced cash.

FBI Assistant Director-in-Cost Sweeney additional detailed that Spence allegedly “used cash from new traders to repay others with the intention to preserve his plan transferring — a typical marker of a Ponzi scheme.”

In line with the Justice Division, from November 2017 by means of April 2019, Spence solicited traders for a number of cryptocurrency funding funds that he had created and managed. Traders “would switch cryptocurrency, reminiscent of bitcoin and ethereum,” to him to put money into the funds for them. The DOJ elaborated:

The biggest and most lively of which have been the Coin Indicators Bitmex Fund, a/ok/a the ‘CS Mex Fund,’ the Coin Indicators Different Fund, a/ok/a the ‘CS Alt Fund,’ and the Coin Indicators Lengthy Time period Fund.

Spence is charged with one depend of commodities fraud, which carries a most sentence of 10 years in jail, and one depend of wire fraud, which carries a most sentence of 20 years in jail.

The Commodity Futures Buying and selling Fee (CFTC) has additionally filed a federal civil enforcement motion in opposition to Spence, charging him with fraud for working the Ponzi scheme.

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