‘Cherry Picking’ Crypto Fraudster Sentenced to 2 Years in Prison

US authorities have sentenced the CEO of an investment firm to prison for masterminding a fraudulent crypto scheme. In a crypto scam known as ‘cherry picking', he collects money from investors for trades but later decides whether to allocate the trades to the investors or himself based on their profitability.

“Camboline defrauded investors in the United States and abroad by, among other things, depriving them of profitable trades,” the report said.

Cherry Picking Crypto Scam

According to a statement released by the United States Department of Justice (DOJ), Strategic Alpha Management CEO Peter Cambolin has been sentenced to two years in prison for masterminding the so-called cherry-picking crypto scam.

“During the relevant period, Cambolin fraudulently misappropriated the pool participants' transactions and trades he conducted on behalf of his proprietary accounts to benefit his own accounts.”

Cherry-picking is a fraudulent technique in which an individual makes trades without referring those trades to a specific trading account. This is not done until the individual is sure whether the business is profitable or not.

However, Cambolin effectively monitors the performance of all trades throughout the day, keeping the most profitable crypto trades for itself. Meanwhile, this allowed him to enjoy the benefits of risk-free trading, while the investors suffered losses.

Cambolin used the scheme's proceeds to subsidize personal expenses. This includes renting a beachfront apartment. In addition, the trading partner controlled by Belarus and Dominica by transferring income to foreign bank accounts.

Meanwhile, a recent report from Chinalysis revealed that the majority of crypto fraud was committed using stablecoins last year. However, last year saw a sharp drop in crypto-fraud, with overall illicit revenue down 29.2 percent.

Read more: 15 most common crypto scams to look out for

Crypto investment scams are on the rise.

However, this comes after several arrests related to crypto fraud in recent times.

In the year In November 2023, BeenCrypto reported that two individuals from Arizona were to be indicted for their involvement in a crypto investment scheme.

The indictment includes a total of 55 counts of wire fraud and money laundering.

There were many companies in the couple's name. One of them, Now Mining, offers “risk-free” investments in the leasing of bitcoin mining machines allegedly located overseas.

Meanwhile, another, VIP Mining, is involved in direct investments in Bitcoin mining machines in Arizona.

Read more: How to identify a scam crypto project