Two central figures behind the cryptocurrency Ponzi scheme referred to as IcomTech have been sentenced to substantial jail phrases, in line with a latest press launch by the US DoJ.
The scheme defrauded hundreds of traders out of thousands and thousands of {dollars}, leaving monetary devastation in its wake. The sentencing marks a significant authorized conclusion to one of many extra outstanding circumstances of cryptocurrency fraud.
Particulars of the IcomTech Scheme
David Brend and Gustavo Rodriguez, key operators of IcomTech, obtained jail sentences of 10 and eight years, respectively, handed down by Choose Jennifer L. Rochon following a March trial the place each have been convicted of conspiracy to commit wire fraud.
Prosecutors revealed that IcomTech, launched in mid-2018, masqueraded as a cryptocurrency mining and buying and selling agency, promising excessive every day returns to draw investments. Nonetheless, in actuality, the corporate didn’t have interaction in any reliable buying and selling or mining actions.
As a substitute, funds collected from traders have been used to pay earlier traders in a “traditional Ponzi scheme” trend. Promoters like Brend flaunted luxurious life, together with costly vehicles and designer clothes, to lure victims.
Traders have been supplied entry to an internet portal to watch alleged earnings, however most have been unable to withdraw their cash, finally shedding their complete investments.
The US DoJ additionally reveals that Brend and Rodriguez’s scheme didn’t finish there. When complaints heightened amongst the traders, they restrategized and “started providing proprietary crypto-tokens on the market as a method of injecting liquidity into IcomTech.”
Nonetheless, the token dubbed “Icoms”, was additionally nothing apart from a sham. The US DoJ wrote within the press launch:
Promoters of the schemes claimed that these tokens, referred to as “Icoms”, would finally be value a major amount of cash once they have been accepted by firms for fee for items and companies. This was false. In actuality, “Icoms” have been primarily nugatory and resulted in additional monetary loss to Victims. By in or concerning the finish of 2019, IcomTech stopped making funds to Victims and IcomTech collapsed.
Authorized and Monetary Repercussions
Gustavo Rodriguez, who managed IcomTech’s web site and crafted compensation plans, was ordered to pay $40,000 in forfeiture, representing his direct proceeds from the scheme, with restitution quantities to be decided.
David Brend, a promoter of the scheme, additionally faces pending restitution and forfeiture determinations. U.S. Lawyer Damian Williams famous:
David Brend and Gustavo Rodriguez have been central to the IcomTech Ponzi scheme – Rodriguez because the chief architect of its sham web site, Brend as a face-to-face salesman who peddled the bogus enterprise and its supposed profitable returns for traders. Along with others, Brend and Rodriguez defrauded hundreds of individuals out of thousands and thousands of {dollars}. Each have been discovered responsible by a unanimous jury. Now they’ll serve substantial jail sentences for his or her crimes.
Assistant U.S. Lawyer Damian Williams, representing the Southern District of New York, counseled the investigation led by Homeland Safety’s El Dorado Job Pressure, alongside contributions from the SEC and CFTC.
Williams highlighted the gravity of the defendants’ actions, noting that they exploited their positions to complement themselves on the expense of hundreds of victims.
Featured picture created with DALL-E, Chart from TradingView
