The co-founder of AirBit Club, a cryptocurrency pyramid scheme that defrauded investors of more than $100 million, has been sentenced to 12 years in prison for participating in a $100 million “pyramid scheme” allegedly involving cryptocurrency mining. .
The verdict comes nearly seven months after AirBit Club co-founder Rodriguez pleaded guilty in March to wire fraud conspiracy charges in U.S. District Court.
Damian Williams, U.S. Attorney for the Southern District of New York, issued a statement on September 26 explain Rodriguez preyed on inexperienced investors through false promises that their funds would be invested in legitimate cryptocurrency trading and mining operations.
“Rather than investing on behalf of investors, Rodriguez used Bitcoin, attorney trust accounts, and international front and shell companies to hide and enrich victims’ money in a sophisticated money laundering scheme. Private pocket.”
District Judge George B. Daniels sentenced Rodriguez to 12 years in prison followed by three years of supervised release.
.@HSINewYorkThe Eldorado Task Force is the largest anti-money laundering task force in the United States and is proud to have played an important role in pursuing justice for Pablo Renato Rodriguez and the victims of the fraudulent “AirBit Club” Ponzi scheme played a vital role #homelandsecurityinvestigation #HSINY https://t.co/UVco4ai3rI
— HSI New York (@HSINewYork) September 26, 2023
The convicted fraudster was ordered to forfeit $65 million and other items, including a total of 3,800 Bitcoin (BTC) worth $100 million, Rodriguez’s residence in Irvine, California, and items seized from the property. 900,000 and nearly $1. $1 million previously held in escrow for a Gulfstream jet.
The other defendants – dos Santos, Scott Hughes, Cecilia Millan and Karina Chairman – have also pleaded guilty and are awaiting sentencing.
related: How to tell if a cryptocurrency project is a Ponzi scheme
AirBit Club was launched in 2015. Potential investors are told that AirBit Club earns returns through cryptocurrency mining and trading, and victims receive passive, guaranteed daily returns with any membership purchase.
However, back in 2016, club members looking to withdraw their proceeds were met with excuses, delays and hidden fees, and told they would have to recruit new members if they wanted to receive their proceeds.
Club operators, including Rodriguez, were charged with fraud and money laundering by the U.S. Department of Justice in August 2020 following an investigation by U.S. Homeland Security Investigations.
According to a June 28 report by blockchain intelligence firm TRM Labs, $7.6 billion was lost to cryptocurrency Ponzi and pyramid schemes in 2022.
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