Mastermind of Bitcoin Mining Ponzi Scheme Extradited to the US: $20 Million in Victims' Funds Laundered

The US government says it has extradited Gutemberg Dos Santos, the co-founder of the Airbit Club Ponzi scheme from Panama and he now awaits his trial in a Manhattan court. Dos Santos is facing charges relating to his role in perpetuating a “cryptocurrency” scam which defrauded victims of “tens of millions of dollars.”

Fraudulent Claims

According to the US Department of Justice (DOJ), Dos Santos and five accomplices are accused of falsely promising victims that they will earn passive income from cryptocurrency mining. However, investigations found that “no bitcoin mining or trading on behalf of victims actually took place.”

In a November 30 statement, the DOJ said Dos Santos – a citizen of Brazil and the United States – instead “hosted lavish expos and small community presentations aimed at convincing victims to purchase Airbit Club memberships.” Once Dos Santos and his accomplices gained control of the money, they would proceed to hoodwink unsuspecting victims into believing that everything was above board. The DOJ press statement explains:

Following a victim’s investment, a promoter provided the victim with access to an online Airbit Club portal to view the purported returns on memberships. While victims saw ‘profits’ accumulate on their Online Portal, those representations were false.

With victims convinced that their “investment” was earning them an astronomical return, Dos Santos and his accomplices in the meantime were using victims’ funds to enrich themselves. As the DOJ statement explains, the accused “spent victim money on cars, jewellery, and luxury homes, and financed more extravagant expos to recruit more victims.”

Bringing in the ‘New Blood’

According to the DOJ, one of the accused, lawyer Scott Hughes is separately accused of “helping to remove negative information about Airbit Club and Vizinova from the internet.” Hughes has previously represented Dos Santos when he faced an investigation by the US SEC.

Furthermore, the DOJ is accusing Dos Santos and the co-defendants of using “excuses, delays, and hidden fees” to deny victims access to their funds. In one instance, a female victim was told that “she should bring ‘new blood’ into the Airbit Club scheme in order to receive her returns.” The victim was informed of this after she lodged a complaint about her inability to make a withdrawal.

In another instance, a victim was told their account had been closed and the principal investment had been lost. One of the accused mentioned the following as reasons for the loss:

Due to execution of financial sustainability Reserve, policy #34 of the Airbit Club Terms and Conditions, due to the economic and financial crisis caused by (Covid-19).

According to the DOJ, a total of $20 million is believed to have been laundered by Dos Santos and his accomplices. Consequently, Dos Santos, who must answer to three charges, faces a total maximum sentence of 70 years in jail.

Sourse: news.bitcoin.com


Start mining bitcoin now

Start trading bitcoin now

Category: News | Views: 64 | Added by: danyagames2007 | Tags: #Bitcoin #Bitcoin markets #btc news | Rating: 0.0/0
Total comments: 0
Name *:
Email *:
Code *:
Buying the Bitcoin Dip: MicroStrategy Scoops $10M Worth of BTC Following $7K Daily Crash (0)
MicroStrategy buys the Bitcoin dip worth $10 million (0)
Bitcoin is unlikely to replace gold as a risk diversifier – DBS Bank (0)
Demand for Bitcoin Miners Pressures Chip Makers Amid Global Shortage (0)
OKCoin to Integrate Bitcoin’s Lightning Network in Q1 (0)
Bitcoin's biggest mining pool may be behind the BTC price drop, but buyers stepped in (0)
Grayscale Acquires $1,276,147,151 in Bitcoin in Single Week (0)
Hive Blockchain Buys 6,400 Bitcoin Miners From Canaan, Capacity Reaches 1,229 PH/s (0)
Biden names new SEC and CFTC administration – curse or blessing for Bitcoin? (0)
Learn the basics of Bitcoin with some help from a pro (0)