A US resident who masqueraded as a cryptocurrency guide has been sentenced for embezzling cryptocurrency and money fraudulently obtained from traders.
The US Division of Justice (DoJ) said on Tuesday that Jerry Ji Guo, a resident of San Francisco, will spend six months behind bars and has been ordered to pay $4.4 million in restitution for his actions.
The 33-year-old former journalist admitted to reshaping himself as an skilled and guide on cryptocurrency and Preliminary Coin Choices (ICOs).
ICOs are investor occasions that initially shaped to present rising initiatives an alternate funding path to angel funding or loans. Members in authentic ICOs obtain project-branded tokens for his or her contribution, and will the mission succeed, this might enable traders to reap substantial earnings. Nevertheless, ICOs are dangerous and have paved the best way for exit scams and fraud.
In Guo’s case, he conned traders by promising he would carry out “consultancy, advertising and marketing, and publicity companies,” based on US prosecutors. Nevertheless, as an alternative of maintaining his promise, investor money and cryptocurrency — together with Bitcoin (BTC) and Ethereum (ETH) ended up being drained from wallets utilized by corporations to deposit funds up-front so as to safe his ‘companies.’
The cryptocurrencies taken from traders have surged in worth over the previous few years and the mixed funds, with money, are actually value an estimated $20 million.
A federal grand jury indicted Guo in 2018 and he pleaded responsible to at least one depend of wire fraud a yr later. Seven different counts of wire fraud have been dismissed. On the time of the indictment, Guo confronted up to 20 years behind bars.
Alongside the jail sentence and reparation, Guo can even need to submit to 3 years of supervised launch.
The DoJ’s Cash Laundering and Asset Restoration Part obtained warrants in February 2020 to grab the stolen funds and says that the federal government “is [now] able to return the stolen property to the victims.”
Earlier this month, US prosecutors sentenced the previous proprietor of RG Cash, Rossen Iossifov, to 10 years in prison after he was discovered responsible of laundering funds from on-line public sale scams via his cryptocurrency trade.
The DoJ and FBI are continuously looking down the perpetrators of cryptocurrency-related fraud and schemes, and now, the US Securities and Alternate Fee (SEC) maintains a listing of each fiat funding and crypto companies that customers must be cautious of.
In January, SEC added a further eight cryptocurrency organizations to its watch record which tout all the pieces from unrealistic returns to ICO authorized safety, and risk-free cryptocurrency buying and selling.
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