Six people involved in a cryptocurrency “Ponzi scheme” that raised about $100 million in five years have pleaded guilty to a series of fraud and money laundering charges, each carrying a maximum sentence of 20 to 30 years imprisonment.
One of the founders of “AirBit Club,” Pablo Renato Rodriguez, was the last to plead guilty to conspiracy charges for fraud on March 8.
According to a March 8 statement from the US Department of Justice (DOJ), AirBit Club was a bogus cryptocurrency mining and trading company operating between 2015 and 2020 where executives and promoters tricked victim investors into believing they were guaranteed to pass income and profit on each membership purchased.
Operators and Attorney of Global Multi-Million Dollar Cryptocurrency Ponzi Scheme “AirBit Club” Plead Guiltyhttps://t.co/MT3mM9aqPV
— U.S. Attorney SDNY (@SDNYnews) March 8, 2023
According to the DOJ, the perpetrators traveled throughout the United States, Latin America, Asia and Eastern Europe marketing AirBit at “lavish expositions” to convince investors to purchase AirBit Club memberships.
Victims saw “profits” piling up on the AirBit Club online portal, but no real mining or trading took place. A victim who tried to withdraw was asked to “bring new blood” into the AirBit Club plan to withdraw her money.
US attorney Damian Williams said the operators used victims’ money to buy luxury cars, homes and jewelry. Part of the proceeds were used to fund more exhibits to recruit more victims as well:
“The defendants took advantage of the growing cryptocurrency hype to defraud unsuspecting victims around the world of millions of dollars with false promises that their money would be invested in cryptocurrency trading and mining.”
“Instead of trading cryptocurrency or mining on behalf of investors, the defendants built a Ponzi scheme and took the money from the victims to line their own pockets,” he added.
The representatives were first officially charged on August 18, 2020.
Since then, senior promoters Cecilia Millan, Jackie Aguilar and Karina Chairez have each pleaded guilty to a series of bank fraud conspiracy, bank fraud conspiracy and money laundering conspiracy on Jan. 31, Feb. 8 and 22, while another founder, Gutenberg, said the statement. of March 8, Dos Santos pleaded guilty to fraud and conspiracy charges of money laundering on October 21, 2021.
These guilty pleas send a clear signal that we are after all those who seek to misuse cryptocurrency to commit fraud,” Williams added.
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The operators have been ordered to forfeit their fraudulent proceeds from AirBit Club, which include fiat currency, real estate and Bitcoin (BTC), which are collectively worth about $100 million.
Cointelegraph found that there are still videos of the AirBit Club representatives promoting the membership program on YouTube.
The scheme often used the hashtag “#AirBitBillionaireClub” and shared several false investor success stories to lure more victims.
California licensed attorney Scott Hughes, an attorney charged with laundering the proceeds of the scheme, also pleaded guilty to money laundering charges on March 2.
Rodriguez, Millan, Aguilar, Chairez and Hughes will be sentenced on different dates between June and August this year.
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