A U.S. crypto trader who lured investors with promises of sky-high returns has pled guilty to commodities fraud.
The U.S. Department of Justice announced that Jeremy Spence, known online as “Coin Signals,” entered a guilty plea in a U.S. district court in connection with allegations that he solicited more than US$5 million from investors for various crypto funds he operated by making false promises of high returns.
According to the DoJ, Spence solicited investments into several funds — which included the Coin Signals Bitmex Fund, the Coin Signals Alternative Fund and the Coin Signals Long Term Fund — through false representations about the profitability of his trading.
“For example, on January 28, 2018, Spence posted a message in an online chat group falsely claiming that his trading of investor funds over the past month had generated a return of more than 148%. As a result of this misrepresentation, investors transferred additional funds,” the DoJ said, noting that his trading resulted in losses for investors.
To hide those trading losses, Spence continued raising money from investors to pay earlier investors. In doing so, he turned over about US$2 million in crypto to investors.
The U.S. Commodity Futures Trading Commission (brought a separate civil action against Spence earlier this year.