A cryptocurrency fund manager has actually been charged in a U.S. federal court. He supposedly took control of $5 million from financiers interested in investing in his crypto funds, guaranteeing them high returns. In truth, he was running a Ponzi scheme and is now facing up to 30 years in prison.
Crypto Fund Manager Arrested for Running a Ponzi Scheme
The U.S. Department of Justice (DOJ) revealed Tuesday that Jeremy Spence has actually been apprehended and charged in Manhattan federal court in a deceptive cryptocurrency scheme. The 24-year-old from Bristol, Rhode Island, is also referred to as “Coin Signals.”
Spence is “a cryptocurrency trader who got funds for different cryptocurrency funds that he ran, with products scams and wire scams offenses,” the DOJ explained, including:
Spence took cryptocurrency worth over $5 million from more than 170 private financiers after making incorrect representations in connection with these cryptocurrency funds.
U.S. Attorney Audrey Strauss discussed that the offender “supposedly tempted financiers to his cryptocurrency financial investment rip-off by promoting returns of up to 148%.” However, his financial investment swimming pools regularly lost cash.
FBI Assistant Director-in-Charge Sweeney even more detailed that Spence supposedly “utilized cash from brand-new financiers to settle others in order to keep his strategy moving — a common marker of a Ponzi scheme.”
According to the Justice Department, from November 2017 through April 2019, Spence got financiers for numerous cryptocurrency mutual fund that he had actually developed and handled. Investors “would move cryptocurrency, such as bitcoin and ethereum,” to him to invest in the funds for them. The DOJ elaborated:
The biggest and most active of which were the Coin Signals Bitmex Fund, a/k/a the ‘CS Mex Fund,’ the Coin Signals Alternative Fund, a/k/a the ‘CS Alt Fund,’ and the Coin Signals Long Term Fund.
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Spence is charged with one count of products scams, which brings an optimal sentence of ten years in prison, and one count of wire scams, which brings an optimal sentence of twenty years in prison.
The Commodity Futures Trading Commission (CFTC) has also submitted a federal civil enforcement action versus Spence, charging him with scams for running the Ponzi scheme.
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