- The U.S. DOJ recently sentenced an unethical actor to prison as he coaxed folks to hand him crypto, which he would invest.
- He represented profits on his accounts when he was actually incurring massive losses.
- He ripped off approximately $5 Million from 170 people who unsuspected his fraud scheme.
The United States Department of Justice (DOJ) has recently sentenced a crypto trader to 42 months in prison. He is accused of operating a series of cryptocurrency funds and claiming to make big returns, but in reality, he was losing all the money and operated a fraud scheme.
This Poor Crypto Trader Went Through Constant Losses
The DOJ highlighted that the 25-year-old Jeremy Spence had sought millions via fake representations, including that his crypto trading had been extremely profitable when actually it was constantly unprofitable.
Spence operated the social media channels for a crypto investment scheme by the name Coin Signals. He was sentenced to prison by the United States District Judge Lewis Kaplan for the U.S. District Court for the Southern District of New York.
Furthermore, he was also sentenced to three years of supervised release and was also asked to pay back his victims an amount of more than $2.8 million. He was arrested by the Federal Bureau of Investigation (FBI) in January last year. And the Commodity Futures Trading Commission (CFTC) also put forward separate civil charges against him.
He pleaded guilty to commodities fraud in November last year for soliciting more than $5 million from unsuspecting crypto investors by creating several cryptocurrency funds between November 2017 and April 2019, which he falsely claimed were making returns, but in reality, were resulting in losses.
An instance that the Department provided highlighted that Spence posted a message online to a chat group that said that one of the funds made 148% returns that month.
The investors would transfer the crypto to Spence to invest with an expectation of profits. And because his trades were not making gains, he created fake accounts to represent profits. He started to spend the funds taken from new investors to pay the previous ones. There are even estimates that he utilized about $2 Million of cryptocurrencies to distribute this way.
Whereas Jeremy Stence did apologize to his investors and highlighted that he entered a world which he was totally unprepared for.
Source: https://www.thecoinrepublic.com/2022/05/12/crypto-trader-sentenced-to-42-months-prison-for-fraud-claimed-to-make-profits/