A crypto Ponzi schemer who took over US$40 million from investors has been sentenced to eight years in prison in New York.
In a federal court in Brooklyn, one of the alleged perpetrators of a crypto trading scheme, Dwayne Golden, was ordered to serve 97 months in prison and forfeit almost US$2.5 million on wire fraud conspiracy and money laundering charges. Additionally, the court will order restitution at a future date.
Last September, Golden pleaded guilty to charges that arose from an investment scheme that raised over US$40 million from investors amid false promises of guaranteed returns from crypto trading.
According to court filings, between April and August 2017, Golden and his co-conspirators operated a series of crypto companies — including EmpowerCoin, ECoinPlus and Jet-Coin — which promised investors guaranteed fixed returns generated by offshore crypto trading. However, the companies never engaged in any trading, and instead investors’ money was either stolen or used to repay other investors.
Additionally, after the scheme collapsed, the co-conspirators allegedly obstructed federal investigations into the scheme.
All four defendants in the case have pleaded guilty. Two are awaiting sentencing and one other participant in the scheme has been sentenced to 30 months in prison.
In a parallel civil action, the U.S. Commodity Futures Trading Commission also filed a federal civil enforcement case against the scheme’s alleged operators. It’s seeking restitution, disgorgement, civil penalties and permanent trading and registration bans.