Five people indicted for allegedly running $20 million crypto mining Ponzi scheme

On Tuesday, the US Department of Justice (DOJ) unsealed an indictment against five people, who were allegedly involved in a million-dollar crypto mining Ponzi scheme. The defendants defrauded unsuspecting investors about $20 million from investments in their digital currency trading and mining company, AirBit Club, which does not exist.

US prosecutors charge five people for crypto mining Ponzi scheme

Following the report from the DOJ, the defendants include Gutemberg Dos Santos, Jackie Aguilar, Pablo Renato Rodriguez, Cecilia Millan, and Scott Hughes. The group which is now in custody, allegedly sought investments for their non-existing company, promising would-be investors an extraordinary rate of returns.

The crypto mining Ponzi scheme originated in 2015 by RODRIGUEZ and DOS SANTOS, who later recruited MILLAN and AGUILAR as marketers. The falsely touted that AirBit Club revenue is generated from crypto mining and trading activities. So, they told victims that they would earn high returns passively, once they buy their membership plan.

Fake promises of high return

At the long run, the defendants failed to deliver on their promises. Moreover, it was a crypto mining Ponzi scheme that does not even exist, as the prosecutors alleged. They used the proceeds to enrich themselves, by purchasing luxurious items such as houses, cars, jewellery, the report reads.

Acting US Attorney Audrey Strauss commented in the report:

“As alleged, the defendants put a modern-day spin on an age-old investment scam, promising extraordinary rates of guaranteed return on phantom investments in cryptocurrencies. Thanks to HSI, the defendants are in custody and facing serious criminal charges.”

It was said that the group laundered $20 million at least, from their crypto mining Ponzi scheme business. 

Dos Santos, Rodriguez, and Millan have been charged with single counts of conspiracy to commit bank fraud, conspiracy to commit money laundering, and conspiracy to commit wire fraud. Aguilar was charged with one count of conspiracy to commit wire fraud. Hughes was charged with one count of conspiracy to commit money laundering and one count of conspiracy to commit bank fraud.