The United States Attorney for the Southern District of New York announced that a total of six executives of the cryptocurrency Ponzi scheme AirBit Club have pleaded guilty for their roles in an internationally coordinated series of fraud and money laundering charges.
Over a period of five years, the operators of AirBit Club had allegedly raked in approximately $100 million. This includes co-founders Pablo Renato Rodriguez and Gutemberg Dos Santos, their attorney Scott Hughes, and AirBit promoters Cecilia Millan, Karina Chairez, and Jackie Aguilar, who have pled guilty to charges including wire fraud conspiracy, bank fraud conspiracy, and money laundering conspiracy charges
In a statement, US Attorney Damian Williams said the six executives took advantage of the growing hype around the asset class to deceive unsuspecting victims around the world out of millions of dollars with false promises that their money was being invested in cryptocurrency trading and mining.
“Instead of doing any cryptocurrency trading or mining on behalf of investors, the defendants built a Ponzi scheme and took the victims’ money to line their own pockets. These guilty pleas send a clear message that we are coming after all of those who seek to exploit cryptocurrency to commit fraud.”
According to the law enforcement’s findings, Rodriguez, Dos Santos, Hughes, Chairez, and Millan requested the victims to purchase memberships in cash using third-party cryptocurrency brokers. Illicit proceeds of the AirBit Club Scheme were then laundered via several domestic and foreign bank accounts, including an attorney trust account managed by Hughes.
Using this account, the attorney directed funds to the personal expenses of the co-founders and promoters as well as to himself. These funds were also used for promotional events and sponsorships designed to further promote the AirBit Club Scheme.
Spendings on Lavish Expos, Luxury Homes
All the defendants, who were first charged in August 2020, traveled throughout the United States and Latin America, Asia, and Eastern Europe, hosting “lavish” expos and small community presentations aimed at convincing victims to purchase AirBit Club memberships.
The prosecutors further stated that the victims were able to view “profits” being accumulated on their Online Portal. However, there was no actual Bitcoin mining or trading on behalf of the victims that took place. Instead, operators of the scam project “enriched themselves” and spent the money on cars, jewelry, and luxury homes, and funded more extravagant expos to amass more victims.
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