Mining Capital Coin CEO indicted in $62 million crypto fraud scheme

By May 8, 2022 No Comments

Mining Capital Coin CEO and founder Luiz Capuci Jr. changed into — in an indictment unsealed the day outdated to this — accused by the DOJ of allegedly running a $62 million world investment fraud scheme. He’s the most up-to-date of several crypto firm heads who’ve recently been similarly charged.

By his firm, Capuci convinced investors to steal “Mining Applications,” a world network of cryptocurrency mines that promised a certain return on investment every week. But instead of using investors’ funds to mine cryptocurrency as he promised, the DOJ alleges that Capuci diverted the funds to his maintain cryptocurrency wallets. Any other MCC product identified as “Trading Bots” operated below the identical unfaithful pretenses. Capuci claimed that the bots operated in “very high frequency, being in a put aside of abode to finish hundreds of trades per 2d” and promised investors each day returns.

“As he did with the Mining Applications, then again, Capuci allegedly operated an investment fraud scheme with the Trading Bots and changed into no longer, as he promised, using MCC Trading Bots to generate income for investors, nevertheless instead changed into diverting the funds to himself and co-conspirators,” wrote the DOJ in its indictment.

MCC looked as if it might perhaps well have your complete workings of a pyramid scheme. Capuci recruited affiliates and promoters to entice investors. In return, he promised the promoters a replacement of lavish gifts, including Apple watches, iPads and luxury autos.

Currently the FBI’s Miami Field Place of work is investigating the case. The DOJ has charged Capuci, who is from Port St. Lucie, Florida, with conspiracy to commit wire fraud, conspiracy to commit securities fraud and conspiracy to commit international money laundering. If learned guilty, he faces a most sentence of 45 years.

In a overview of the cryptocurrency mining platform, crypto blogger Peter Obi renowned that the combination of MCC’s $50 monthly charge for membership and its steep 3% withdrawal charge supposed that investors had been unlikely to kind a income unless they referred other investors. He pointed out that such a referral job changed into “severely worrying” because it changed into in keeping with other previous crypto scams.

Indeed, a replacement of crypto leaders had been accused by authorities of running Ponzi schemes in recent years. Earlier this year the DOJ indicted Bitconnect founder Satishkumar Kurjibhai Kumbhani for allegedly running a $2 billion Ponzi scheme — believed to be the ideal digital forex pyramid scheme in historical previous.

Capuci by no draw registered his firm with the SEC. The company at the unique time issued a fraud alert for the firm. According to the SEC , Capuci and his associates successfully convinced 65,535 investors to steal mining programs worldwide and promised each day returns of one percent, paid weekly for over a year. In total, the personnel netted $8.1 million from the sale of the mining programs and $3.2 million from initiation bills.

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