US charges 18 people, companies with crypto fraud
The US has indicted 14 people and four companies for fraud and market manipulation, among other illegal activities. Prosecutors say this is the first criminal case involving cryptocurrency companies for market manipulation and money laundering.
US prosecutors have indicted 14 people and four crypto companies for widespread market manipulation and fraud.
According to a press release from the US Attorney's Office for the District of Massachusetts, federal prosecutors announced on Wednesday that the case involves the first criminal charges against financial services companies linked to the crypto market. As well as fraud, charges include bogus trading and crypto price gouging.
“What the FBI found in this case is a new twist on old-school financial crime,” said Jody Cohen, Special Agent in Charge of the Federal Bureau of Investigation's Boston Division.
Sophisticated trading schemes can cause investors to lose millions of dollars, Cohen added.
The four companies are Gotbit, CLS Global, ZM Quant and MyTrade.
US prosecutors in Boston have also filed charges against the company's leaders and employees. Those charged include individuals in the United States and Hong Kong. Federal prosecutors say five individuals have agreed to plead guilty to overseas arrests.
Saitama and Gotbit
Maxwell Hernandez, Russell Armand, and Nam Tran allegedly created and promoted various crypto projects that allegedly engaged in price manipulation and defrauding users.
This platform includes Saitama, a crypto project on Ethereum that reached a market capitalization of more than $7.5 billion at the peak of its generation token. Saitama offers a real estate investment product and token.
One of the crypto companies sued Gotbit, engaged in a laundry business, and robo-inu's trading volume increased tenfold. This resulted in a false amount of $1 million.
Imagine getting paid $1 million for making a fake amount for something called RoboInu pic.twitter.com/Dc0DJbJOuO
— db (@tier10k) October 9, 2024
The indictments against the 14 and their companies come as the industry faces regulatory scrutiny amid claims of market manipulation and theft.
In September, the FBI arrested 20-year-old Malone Lam and 21-year-old Xandiel Serrano on charges of fraud and money laundering in the $230 million theft.
